Nothing is safe from fraudsters, not even a ride-hailing app. After all, these mobility-as-a-service apps exist digitally, which makes them vulnerable to online fraud. So, how fraudsters take advantage of ride hailing apps?
With how everything has been digitized, getting transportation services is now made easier and cost-efficient. With these ride hailing applications, anyone could easily select which vehicle they find the most comfortable, right in front of wherever they are.
That being said, people will always find a weak spot they can abuse for their own gain. Companies need to fix these vulnerabilities in ride-hailing apps with the right tool, providing a fair and honest ecosystem to everyone.
What is a ride-hailing app?
At this point, people already know what it is and have used it at least once. The ride-hailing app is an online application that provides a local transportation service that its customers can request through their smartphone.
Unlike taxis, these apps give customers a customized experience, allowing them to select the transportation vehicle. The app then connects the consumers to the nearby drivers that match their selection.
Why is it called a “ride-hailing” app? This is because ride-hailing refers to people calling or shouting to ask for a ride. In this context, customers simply call a ride not by doing it physically, but rather, calling it using the app.
Ride-hailing apps have become popular nowadays due to many reasons. Here are some of the reasons why:
- Provides a convenient method of getting the ride. Customers can easily get transportation anywhere they are, instead of looking for a taxi or bus station.
- Sometimes offers a discounted price to customers. This can reduce the cost of traveling, encouraging people to keep using the service as it is cheap.
- Gives people a job as an app’s registered driver. Companies can gain profit from customers while also helping local people to get a job by working for them.
Types of Fraud that Threaten Ride-Hailing Apps
Despite their advantages, ride-hailing apps face numerous disadvantages. One of the major disadvantages of ride hailing apps is a fraud that could potentially give a major loss to the companies that provide them.
How fraudsters take advantage of ride hailing apps anyway? When it comes to explaining how fraudsters take ride hailing apps for their unlawful schemes, it needs to be divided into two separate categories:
As a Driver
Despite being given an opportunity to gain additional income, some drivers may still attempt to trick the apps to maximize their salary. Here are many ways they can do it that the app companies need to learn about:
Fake Rides
Some ride-hailing app companies give extra tips for drivers who meet the required passenger quota, encouraging them to work harder. However, it can be tricked by fake rides. Here’s how:
- Drivers may clone the apps and act as both driver and passenger. Then, they act as if the passenger is actually a real person using the driver’s service.
- Drivers manipulate GPS location for fake accounts, tricking ride-hailing apps to think these accounts are real people using the driver’s service.
Artificial Surge Pricing
Rogue taxi drivers used to trick the fare system by playing with the meters to increase the payment. Apparently, now drivers can also do the same thing with ride-hailing apps by doing these:
- Drivers gather around in large groups and log off the ride-hailing app together.
- The app will prompt them that there is a high demand in the area they are taking a break.
- Drivers then wait until the prices go up due to the high demand, then log back on to get the now doubled payment services.
GPS Spoofing
Another way of how fraudsters take advantage of ride hailing apps is by doing GPS spoofing. This method lets drivers fake their own GPS location, giving an app false information about them being closer to the passengers.
Not only is this a dishonest fraud, but passengers will also have to wait longer due to the drivers being in a further area than what they believed.
Auto-Clickers
Drivers can also accept the ride-hailing apps’ incoming requests by using auto-clickers. This lets them immediately accept the requests, preventing other genuine drivers from getting the potential passengers.
Again, this is another dishonest tactic that may cause genuine drivers to be upset and quit the job. The result? They may figure this out and spread bad news about how the app companies allow scummy tactics, leaving a bad mark on the reputation.
Fake Reviews
The last way of how fraudsters can trick ride hailing applications is by using fake accounts to leave drivers fake good reviews. This maintains the drivers reputation, even if they actually received a lot of negative reviews.
As a Customer/Passenger
Just like any other online services, a customer—or rather, a passenger—can also be the fraudster or the victim of a fraud. These are how they commit the fraud or get the fraud instead:
- Promotion abuse. Customers create multiple accounts to claim all the ride discounts from a ride-hailing app.
- Account takeover. Fraudsters hack victims’ accounts, using the ride-hailing service as they please while the victims are being forced to pay for it.
Also Read: Account Takeover Prevention: Reducing Financial Threats
How to Protect Ride-Hailing Apps from Fraud
With how fraudsters take advantage of ride hailing apps, it is necessary to take this problem into account. However, taking a proactive stance against these bad actors requires the best solution, to name a few:
- Real-time location tracking, which lets the app immediately detect GPS spoofing and manipulation or use auto-clickers for fraud.
- Device fingerprinting, which allows the app to verify the drivers and customers based on device, behavior, and location.
- AI-based protection, which lets the AI detect suspicious behavior in real-time, making sure to prevent a fraud attempt as early as possible.
- Adaptive machine learning, which ensures ride-hailing app companies stay vigilant and prepare for new fraud methods.
Protect your Ride-Hailing Business with Keypaz!
Now, after knowing what is ride hailing app and how frauds can be done on it, all app companies need now is to prevent them. Fortunately, Keypaz already has all the best tools explained above, making them the right choice.
What’s more, you can also customize the device intelligence to suit your ride-hailing service needs. Keypaz also gives a seamless authentication to the customers, making sure the process will be frictionless and effortless.
Knowing how fraudsters take advantage of ride hailing apps, hopefully any mobility-as-a-service companies learn how to deal with them. Especially now that you can rely on Keypaz to protect your business, leaving no room for these fraudsters.