Uber’s got some pretty stiff competition in India, particularly after SoftBank led a $210 million funding round for Ola, but the U.S. firm has taken a major step to raise its appeal to drivers after launching its vehicle financing program in the country.
India becomes the first market in Asia, and only the second outside of the U.S., where Uber drivers can enjoy special rate financing packages and, in some cases, discounts on purchasing cars thanks to their association with the company.
Uber said in a blog post that it has partnered with a handful of insurance firms — including Shriram Finance, AU Financiers and Toyota Financial Services — to offer the preferred rates, which it claims could allow as little as $1,000 (INR 60,000) for down payments. Likewise, Mahindra, Maruti Suzuki, Tata Motors, and Toyota are among the auto firms offering “exclusive” deals, although the company did not go into detail of what kind of discounts are on offer.
The U.S. company is known for describing its drivers as entrepreneurs in their own right — their car is their business, Uber provides supply, so its theory goes — and that’s no different in the case of India.
“With Vehicle Financing, Uber takes a large step forward in its endeavor to create entrepreneurs in every section of society. We have now empowered individuals and have created an ecosystem that will enable hundreds of thousands of young Indians to become new business owners,” the company said in a statement.
Ola has been helping its drivers out with similar financing options since earlier this year, so it’s notable that Uber has extended its program, which debuted in the U.S. one year ago. That’s not say that drivers in India will necessarily switch to Uber just for this reason — Ola’s CEO previously told me he believes that his company has better price flexibility, not to mention a presence in 19 cities versus 10 for Uber — but one major differentiator has at least been leveled out.
One outstanding imbalance between the two is funding, of course. Ola has raised a lot of money for an Indian startup, but Uber pulled in a mammoth $1.2 billion round earlier this year, and rumors are abound that it is in the process of landing another $1 billion right now. That money has to service more than 100 cities across some 45 countries, but India is clearly a big focus. Today’s news and Uber’s expansion to four new cities in August illustrate that, not to mention that India is its second largest market behind the U.S. based on the number of cities served.