NEW DELHI (AFP) - Web-based taxi company Uber has complied with an order to stop operating in New Delhi after an Indian woman said she was raped by one of its drivers.

The city government said Monday it was banning the popular but controversial service, which has come under heavy criticism since the assault.

The suspect, who is in police custody, was driving a taxi while on bail on a slew of previous charges including rape and molestation.

"The events of this week have made us reflect on our operations in India and we are immediately undertaking a number of important actions," the US-based company said in a statement late Thursday.

"During this review, we will suspend operations in New Delhi." Uber, which has come under fire for failing to perform background checks in India, also said it would tighten its driver screening procedures.

The taxi app service has expanded rapidly around the world since it first launched in the United States in 2009.

But it is coming under increasing criticism for failing to adhere to the strict regulations that traditional taxi operators have to follow.