Rising costs will test ride‑hailing sector, but Tada’s zero commission model set to stay: Co-founder

SINGAPORE – Rising labour costs will stress-test ride-hailing operators in Singapore, but Mr Kay Woo, group chief executive of Tada’s parent company, says he intends to keep his zero commission model for drivers, which has shown itself to be sustainable.

Mr Woo, the South Korean co-founder and group chief executive of MVLLABS (MVL) – the parent company behind Tada’s ride-hailing platform – said the zero commission pledge not to take a cut from the driver’s fare is not a marketing ploy or a short-term incentive.

Rather, it is a structural decision on how a ride-hailing platform should work – built on fairness and transparency.

By removing percentage-based commissions, Tada allows drivers to earn more and riders to pay less. The company has about 40,000 drivers registered here and 300,000 globally.

Speaking to The Straits Times in an interview from New York, Mr Woo said the model works even as labour costs are expected to rise with the law to strengthen the safety, retirement adequacy and representation for platform workers.

On Jan 1, 2025, Singapore’s Platform Workers Act came into effect.

Under the Act, platform workers born on or after Jan 1, 1995, must 

contribute more to their Central Provident Fund (CPF) accounts

. Platform operators also face a step-up in mandatory CPF contributions over a five-year period for platform workers, rising from 3.5 per cent in 2025 to 17 per cent by 2029.

Rival ride-hailing operators lament that this will raise costs and squeeze profitability unless platforms hike fares, trim incentives or find efficiencies elsewhere to offset costs. 

Already, larger incumbents – Grab and ComfortDelGro –

raised their platform fees on Jan 1, 2026

, to defray costs linked to the Act.

Mr Woo said the corporate commitment to zero commission is “unchangeable”, even as he concedes a need to be sustainable. 

To square that circle, Tada has introduced a small fixed network fee of 60 cents, charged to both driver and rider to keep the system sustainable.

This fee, coupled with efficiencies derived from software investments made since Tada’s launch here in 2018, is enough to keep operations profitable in the past three years without touching trip commissions, he said. 

In contrast to Tada’s fixed network fee of 60 cents, dominant players here charge a 5 per cent to 10 per cent operational fee on top of taking commissions from drivers.

He said Tada’s Singapore operation is profitable operationally, as are its earnings before interest, taxes, depreciation and amortisation.

It does not rely on cross-subsidies from overseas markets.

Tada’s match ratio has risen from 30 per cent to 40 per cent in its first two to three years to roughly 70 per cent today, a level he describes as “golden” because it limits both lost demand and idle supply.

He said Singapore’s ride-hailing market is larger than its small geography suggests, accounting for 45 per cent to 50 per cent of South-east Asia’s ride-hailing dollar value, even if it lags behind Indonesia and Thailand on trip count.​

Tada’s market share has risen from about 10 per cent in its early years to between 13 per cent and 15 per cent today, versus more than 50 per cent for market leader Grab. 

But Mr Woo said Tada’s focus is on delivering maximum benefit to drivers and users.

So why are there not more drivers jumping on board?

Mr Woo said Tada has no difficulty onboarding drivers, but struggles with user loyalty in a market where riders switch quickly to whichever app offers cheaper fares or better promotions.

But he reckons time is on his side, arguing that “giant platforms have money, but we have time” because Tada’s model is already cash-flow positive in Singapore and globally.

Mr Woo believes that linking better driver welfare to the need to raise consumer fares is a “false trade-off”. 

Rising prices, he argued, stem from bloated corporate overheads. The industry has solved its profitability problem by shifting costs to drivers and users. 

This has become a kind of middleman tax or a hidden cost that Singaporeans end up paying for a business model that has not truly evolved.

Tada, on the other hand, uses blockchain technology for transparency and positions itself as an alternative to that business model. 

Mr Woo sees this as not only fairer economics but also essential preparation for the coming wave of automation.

He said that as autonomous vehicles emerge, ride-hailing could deepen inequality rather than reduce it. The transition threatens to simply replace drivers with corporate-owned fleets.

Tada is betting on a broader shift to agentic commerce, where artificial intelligence agents transact directly on behalf of users, potentially bypassing traditional platform gatekeepers. 

In that scenario, it hopes its role as an infrastructure layer plugged into drivers, payment rails and even blockchain-based credit histories will make commission-based marketplaces obsolete. 

This will allow drivers to connect directly with customers in a fairer, more efficient marketplace.

Tada is preparing to test its on-chain ride-matching technology, an experiment that brings full transparency to how trips are allocated and priced, yet a life-changing model for drivers. 

Every match and transaction will be visible and verifiable, marking a new step in connecting real-world services to blockchain.

This next phase of on-chain matching will begin in Africa, where drivers face some of the highest commissions and financing costs in the world. 

By combining zero commission with transparent on-chain systems, Tada aims to uplift driver livelihoods and show what fairness looks like at scale.

Since its launch, the company has expanded to various markets in Asia, including Cambodia, Vietnam, Thailand and Hong Kong. 

Within the US, it is in Denver, and plans to launch in June in New York City – a market up to four times Singapore’s and crucial for Tada to prove the scalability of its model, Mr Woo said.