India’s Jugnoo is like Uber for auto rickshaws

Chinmay Agarwal, co-founder of Jugnoo, says the company's mobile app has put more money in the pockets of auto-rickshaw drivers. (New Cities Foundation)

This week, Citiscope is looking at three startups and social enterprises that are using technology to make cities work better. All spoke at the New Cities Foundation’s recent summit in Montréal. Read the other profiles here.

Like billions of people around the world, urban dwellers in India cannot rely on well-planned, efficient transit systems to move around their cities. Instead, Indians who don’t own cars have relied for decades on auto rickshaws, three-wheeled motorized taxis known in other parts of the world as “tuk-tuks.” With an estimated fleet of 5 million in the country, the unregulated auto rickshaws play a key part in filling mobility needs.

Indian cities “are almost a decade away from organizing the transportation sector,” says Chinmay Agarwal, Co-Founder and Chief Technology Officer at Jugnoo, a young startup based in Chandigarh, a city in the far north of India. “I can’t even name you one city that has a coherent, ready, strong transportation infrastructure in place.”

Instead of waiting for city governments to delve into transit planning, Jugnoo wants to embrace the informal nature of auto rickshaws and increase their efficiency through an Uber-like ridesharing platform.

A few years ago, such an idea would have been inconceivable, as mobile technology was taking baby steps in India. Then in 2014, smartphones and e-commerce took off, creating endless possibilities for the tech industry. Jugnoo was launched that same year as a simple aggregator of auto rickshaws that was meant to connect riders with drivers. But the company quickly saw a huge demand to address the many challenges that come with using rickshaws, from finding a vehicle late at night to making payments. Hence the new app-based platform.

The system works like a typical ridesharing app. In India, this means having to deal with parameters that are unheard of in western countries.

For example, most drivers are too poor to afford smartphones. So the company chose to give them a device, without obliging them to use Jugnoo at all times. The app also relies on a color-coded interface that makes it easier for illiterate drivers to use. And Jugnoo had to convince drivers to accept cashless payments only, meaning they would have to open a bank account, often for the first time in their lives.

“The biggest problem [for drivers] is trusting they will get the money after a few days,” Agarwal says. “That trust level takes time.”

[Read: In Kampala, an Uber for motorbikes that puts safety first]

Jugnoo’s app has grown to be used by about 3 million people in more than 30 Indian cities. Now the company is focusing on expansion throughout the country. It’s also testing a delivery service in Chandiragh. Along the way, analytics have yielded a number of findings about the rickshaw network, showing important gaps between supply and demand at peak times. Most surprisingly, the data revealed that a majority of the app’s users live in vast informal areas where rickshaws don’t usually think of going. The drivers had been ignoring more than half of their market.

Agarwal says the informal nature of rickshaws makes it much easier for drivers — who get information on these trends through the app — to adapt to changing demand. “The good thing about the auto rickshaws is they’re in a grey zone, an unregulated industry, which means it reacts more efficiently to the market forces,” he explains.

Beyond making life easier for riders, the platform has had a significant socioeconomic impact on drivers. On average, drivers have doubled their income and increased their efficiency by cutting down on idle time spent waiting for customers. Having a bank account has enhanced their access to financial services, such as the ability to take loans, and made it easier for them to build savings. “If that is not improving the lifestyle of a person,” Agarwal says, “I don’t know what would.”

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Flavie Halais is a freelance journalist based in Montréal who covers cities and international social issues. She is currently reporting on the economic impact of refugee crises through her project #RefugeeEconomics. Full bio

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