Tada's zero commission model set to stay despite rising costs

Co-founder says it is a structural decision on how a ride-hailing platform should work

- Angela Tan Senior Business Correspondent

Mr Kay Woo, co-founder and group chief executive of MVLLABS, the parent company behind Tada’s ride-hailing platform, said the zero commission mode works even as labour costs are expected to rise with the law to boost protection and representation for platform workers. PHOTO: TADA

(TADA)

Rising labour costs will stress-test ride-hailing operators in Singapore, but Mr Kay Woo, group chief executive of Tada's parent company, says he intends to keep his zero commission model for drivers, which has shown itself to be sustainable.

Mr Woo, the South Korean co-founder and group chief executive of MVLLABS (MVL) - the parent company behind Tada's ride-hailing platform - said the zero commission pledge not to take a cut from the driver's fare is not a marketing ploy or a short-term incentive.

Rather, it is a structural decision on how a ride-hailing platform should work - built on fairness and transparency.

By removing percentage-based commissions, Tada allows drivers to earn more and riders to pay less. The company has about 40,000 drivers registered here and 300,000 globally.

Speaking to The Straits Times in an interview from New York, Mr Woo said the model works even as labour costs are expected to rise with the law to strengthen the safety, retirement adequacy and representation for platform workers.

On Jan 1, 2025, Singapore's Platform Workers Act came into effect.

Under the Act, platform workers born on or after Jan 1, 1995, must contribute more to their Central Provident Fund (CPF) accounts. Platform operators also face a step-up in mandatory CPF contributions over a five-year period for platform workers, rising from 3.5 per cent in 2025 to 17 per cent by 2029.