Ride-hailing app Grab has officially introduced a cancelation fee for passengers who frequently call off their bookings in Vietnam.

The fee, VND10,000 (US$0.44) per cancelation, will be imposed on customers who have canceledat least seven rides in a seven-day period, local tech news website ICTnews reported on Thursday, citing a Grab announcement.

The money will be deducted from the user’s GrabPay or GrabPay Credits account.

GrabPay is the in-app mobile wallet that is linked with users' credit/debit card while GrabPay Credits is a top-up prepaid account for those who do not want to share their card information with the app.

To ensure that the company is able to collect any imposed cancelation fees, cash-only users who cancel six times within seven days will be asked to connect a credit or debit card with their GrabPay account or top-up their GrabPay Credits balance, in case they cancel a seventh time.

Passengers who refuse the request, or fail to pay the cancelation fee, will have their accounts temporarily suspended.

Currently, Grab’s cancelation fees only apply to its ride-hailing services including GrabCar, GrabTaxi and GrabBike in Vietnam, leaving the delivery - GrabFood and GrabExpress - unchanged.

ICTnews also quoted Grab as saying that passengers have the right to refuse requests from their drivers to cancel a ride.

The reason behind Grab’s new policy, according to ICTnews, is that cancelations made by drivers or passengers cause huge inconveniences for both sides – the loss of earnings for drivers already on their way to pick up a passenger and a loss of trust from passengers who depend on the service for transportation.  

Grab said cancelation rates are also taken into account in its driver performance metrics.

Consequently, to reduce the impact of passenger cancelations on its drivers, cancelation fees will be officially effective and then paid to drivers through Grab.

The tech company had already instated cancelation fees in 2017 for passengers in Thailand and Singapore and is introducing similar charges in the Philippines.

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