Have you ever though that you could make more money if you just cut out the middle man and gave rides to people for cash or credit card only? We know that Uber and Lyft and all these companies really are taking higher and higher commissions. And what a way this would be to get around upfront pricing!
In this video and article I want to talk about whether or not Uber or Lyft drivers should give cash rides instead of using the app.
Take a look at the video, then scroll to the video transcript below if you’d like to read what I cover in the video.
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Short answer to taking cash rides: No!
So for the most part the answer is no unless you have commercial insurance and a taxi license to operate, you cannot be doing cash rides off the app, or with a credit card, or sort of on your own. Does this mean that these rides are still happening? Are drivers still going out and doing cash rides and credit card rides? Yeah, probably a lot.
It’s important to understand the risk of what you’re doing and also what can go wrong if you do it. Because it seems sort of harmless, but I’m gonna share a bunch of examples since we’ve talked to tens of thousands of drivers over the years, we know all the good and the bad.
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UberBlack and SUV drivers can do rides off the apps
If you’re an Uber Black car driver, you are a commercially insured driver. You have licensing. And so Uber Black and Uber SUV, those drivers can actually do rides off the app. They can build a private clientele base, they can use other apps, they can do Craigslist ads, they can do Facebook ads, they can really do whatever they want since they meet those requirements.
Regular UberX drivers can’t take cash rides or street hails
Regular UberX drivers like you and me don’t have commercial insurance and taxi licensing. All I need to do to sign up is sign up with Uber, have personal insurance, et cetera. We’re not legally permitted to give cash rides, or take credit cards, or basically anything on our own. Now, New York City is an exception because UberX drivers there are actually commercially insured and licensed. But for the most part, everywhere else, UberX drivers are not.
Now, even if you do have rideshare insurance, this is not the same as commercial insurance. Rideshare insurance is basically essential if you’re an UberX driver, but it still won’t allow you to do rides off the app. Commercial insurance is typically a lot more expensive, around $3,000 – $5000 dollars each year.
Now, do drivers do these rides anyways? Yes. Do I recommend it? No. Because technically, it’s illegal. And obviously I’m not gonna go around recommending illegal things. Unless you have commercial insurance and that taxi licensing, you can’t be doing these rides legally.
Some drivers get a Square Reader to do off-app rides
Now, I’ve talked to many drivers who sign up for a Square Reader, for example, they exchange information with their passengers. They get nice business cards. And it makes sense, right? If you’re out there providing a great ride for passengers and providing an experience where a passenger says to you, “Hey, I want to get you again as a driver,” you probably should be rewarded for that. And one of the unfortunate things about driving for Uber and Lyft right now is you’re not rewarded too well.
But the things that you do need to watch out for is especially these types of rides at airports. I haven’t heard of many drivers getting in trouble for this for doing what I just described, finding passengers on Uber and Lyft, doing a ride on the app, and then maybe you get them again. Or maybe they say, “Hey, I loved you services, can I hire you again off the app?”
I don’t recommend that, but are drivers doing it? Definitely. Are they advertising their services on Facebook and local groups and stuff like that? Yeah, I’ve talked to many drivers who do that, but at the same time, understand that I don’t think that’s a high risk situation, but really the high risk situation for doing rides off the app are at places like airports. Or when cities are going for undercover stings.
You can get into big trouble at airports
Now this doesn’t happen frequently, but I see it most often at airports where maybe a passenger flags down an Uber or Lyft driver and says, “Hey, I just wanna pay you cash. Can we do this ride off the app?” We’ve heard many kind of horror stories from drivers. And sometimes these stings can be kind of very convincing too.
I’ve even heard of one in LA that was happening where it was a female rider. She flagged down a driver who was speeding down the street and gave him this sort of sob story like, “Oh, my phone died and I have to get home and see my kids,” and all that, “Will you just give me a ride and I’ll pay you 20 bucks?” And this driver, he wasn’t trying to do anything illegal or anything like that. He just felt bad for her. And they ended up busting him.
I don’t think that those scenarios are super likely, but at the same time, if that does happen to you, know it’s a pretty serious offense, your car is gonna get impounded, you’re gonna have to get it out, probably pay a big fine, and maybe it’s even a crime.
As long as you understand that risk, I think that it’s important to know what could go wrong with a cash ride or a credit card ride. And really where the risk is and kinda assess that for yourself.
Uber or Lyft could create a ‘favorite driver’ feature
My suggestion to Uber and Lyft is to create a favorite driver option so that drivers aren’t tempted to do this. If they favorite Harry, as their driver, maybe when they need a ride in the future, they can schedule a ride with me and they have to pay a 50% premium. Now that way the passenger gets a great driver that they really like and feel comfortable with. Me, myself as a driver, I get a passenger and I get to make more money, which is great, and Uber can take a slightly higher cut of the fare too because of their commission and the increased grade.
I think it’s kind of a win win win that way. That’s my advice and if you guys do have any questions or comments, please don’t hesitate to leave them below or send me an email. We release new videos every single Tuesday, and Thursday, and occasionally one on the weekend. So subscribe to our channel if you haven’t already. And give us a thumbs up if you liked it. If you didn’t, let me know why in the comments. Alright, drive safe everyone.
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