Enabling ride-hailing users and drivers to negotiate fares directly within mobility apps could boost mobility access and reduce inefficiencies, a new global study indicates.

In-app fare bargaining could improve price discovery, boost efficiency and expand access to transportation

The research was carried out by Oxford Economics in collaboration with ride-hailing app InDrive and shows that in-app fare bargaining could “improve price discovery, boost efficiency and expand access to transportation”.

The study draws on survey data from riders and drivers across seven emerging markets: Colombia, Egypt, Mexico, Morocco, Nepal, Pakistan and Peru.

The findings suggest that while ride-hailing platforms have significantly improved mobility over the past two decades through algorithmic matching and dynamic pricing, existing pricing systems struggle to fully capture the diversity of rider and driver preferences.

Algorithmic pricing is typically designed to optimise for average market conditions, but it doesn’t serve well the wide variations in incomes, trip distances and travel circumstances across emerging markets. As a result, a single algorithmic price can fail to reflect the true value of a trip for either party, leaving mutually beneficial rides unrealised and some areas underserved by mobility solutions.

In-app fare negotiation helps to bridge this gap, representing a new stage in the evolution of ride-hailing, the study finds. Rather than replacing algorithmic pricing, negotiation complements it. Price discovery typically begins with an algorithmic estimate but allows riders and drivers to adjust fares to reflect individual circumstances.

Anubhav Mohanty, director at Oxford Economics, commented: “These findings highlight the limits of algorithmic pricing in highly variable markets. Where incomes, geography, and trip conditions differ widely, allowing riders and drivers to negotiate prices can improve how markets clear, unlocking additional rides and improving overall efficiency.”

Andries Smit, chief growth businesses officer at InDrive, added: “Fare negotiation brings human agency and individual choice back into the pricing process. By allowing riders and drivers to agree on prices that reflect real-world conditions, we see more trips completed, fairer outcomes for drivers, and better access to mobility for riders, especially in markets where standard pricing models don’t always work.”

Overall, the Oxford Economics study points to a broader shift in the evolution of ride-hailing, from pure automation toward human–algorithm collaboration. While algorithms remain essential for scale and efficiency, introducing price flexibility improves outcomes at the margins, improving both efficiency and accessibility.