Finally in April 2017, Uber India, filed a suit against taxi owners and drivers associations seeking USD1.9 Mn in damages for harming its reputation and the livelihood of drivers.
SBI currently has about USD 18.6 Mn investment towards such cabs. In a statement one of the top SBI executive said,
“We have stopped financing vehicles under Ola and Uber (select geographies) as have we decided to take a cautious approach…The suspension is temporary because we want to watch the situation for some time. There have been certain changes in regulations in many geographies and it’s prudent to see how it evolves before financing these vehicles again.”
Back in January 2016, SBI had launched a digital loan offering for merchants on ecommerce platforms. Starting with larger players like Snapdeal, Flipkart, Paytm, they later extended it to Uber in March 2016, to provide vehicle finance for driver-partners on its platform.
As per the report, SBI has extended loans of about USD 9.3 Mn for owner-drivers operating under Ola with defaults at around about USD 2.5 Mn. On the other hand the vehicle financing portfolio for Uber stood has a 2% default rate. The bank is now recovering the money through auctioning of the seized vehicles.
“We had seized over 280 vehicles and we have auctioned about 80 and the remaining will be auctioned soon. Currently, we are seeing a 20% recovery in NPA accounts.”