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São Paulo's new ride-hailing app challenges Uber and 99 with fair pricing for drivers and riders

In São Paulo, as in most cities, Uber and other ride-hailing apps have become a common way of getting around. On introduction, those apps charged low fees for both drivers and riders. But once the apps implemented higher costs for São Paulo drivers plus passenger surge pricing, vocal dissent  followed. That led some to return to regular taxis, and to the city government building its own competing app.

Launched this month, MobizapSP aims to "improve the conditions of accessibility and urban mobility for citizens, focusing on ease, efficiency, safety and fair pricing." No surge pricing for passengers and a low fee for drivers. While commercial apps currently charge drivers up to 40%, MobizapSP will apply a fixed rate of 10.95%.

Pre-launch, around 20,000 users registered their interest in using the platform, which is currently signing up and vetting drivers before opening the app to passengers. As of yesterday, over 15,500 drivers had registered.

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São Paulo isn't the first Brazilian city to take an active role in the ride-hailing market. In 2017, Rio de Janeiro launched Taxi.Rio, an app used by traditional taxis that similarly charges lower fees. As prices charged by Uber and its Chinese competitor 99 spiked, consumers flocked to Taxi.Rio, proving there's an appetite for a more equitable service.

Unlike Uber or 99, apps like Taxi.Rio and MobizapSP aren't beholden to investors or driven by quarterly earnings, allowing them to operate on lower fees. Whether the government-run alternatives can keep up with the technological pace of their commercial brethren remains to be seen, but the message is clear — when innovators lose sight of fair business practices, the people's representatives might well join the race.