Excerpt from this article in the Harvard Business Review:
In the past, auto rickshaws’ flaws stemmed from low rates of usage, an inability to identify demand and supply in real time, and inefficient pricing that often left both sides dissatisfied. The opportunity to address these issues by leveraging the one billion mobile phones (and counting!) in India was clear.
Rickshaw hail businesses started out tracking the real-time availability and location of drivers through a makeshift system of drivers self-reporting their availability via text messages. With the growing penetration of smartphones, tracking was elevated to GPS in the last few years, but the improvements were similar: a new ability to connect riders and drivers in a timely, reliable way. Rather than relying on happenstance, hailing an auto rickshaw became systematic, especially since the city of Rajkot launched a pioneering model in the form of G-Auto, a city-backed fleet of auto rickshaws, in 2012.
Individually operated rickshaws that previously meandered along disjointed routes with no connection to their customers’ needs now run on optimized routes, leading to improved service and greater road safety. Security has also improved for female passengers, as smartphone hailing apps provide users with the identity of their drivers, allowing for easier reporting of harassment. The system also means that because many drivers have doubled or tripled their number of rides completed in a day, they have been willing to accept the fare displayed on the meter rather than constantly haggling over price. Their increased productivity has put many rickshaw operators on a path to ownership and, in many cases, the means to upgrade to cleaner vehicles.