CCPA Fines Rapido INR 10 Lakh for Misleading Advertisement

The Central Consumer Protection Authority (CCPA) has ordered Rapido (Roppen Transportation Services Pvt. Ltd.) to pay a penalty of INR 10 lakh for printing deceptive advertisements and engaging in unfair trade practices, in a move to defend consumer rights.

Misleading ‘Auto in 5 Min’ Promotion Explained

The Authority has additionally instructed the online ride-hailing platform to guarantee that any customer who used the “AUTO IN 5 MIN OR GET INR 50” promotion and did not obtain the promised INR 50 compensation will receive a complete reimbursement of the money without any further conditions or delays.

Consumer Complaints Against Rapido Surge

Rapido’s deceptive advertising, which promised customers “AUTO IN 5 MIN OR GET INR 50” and “Guaranteed Auto”, was brought to the attention of the CCPA. Following a thorough analysis, the CCPA determined that these commercials were unfair to consumers, untrue, and misleading. As a result, the CCPA ordered that the deceptive commercials be removed immediately.

Shocking Revelation by National Consumer Helpline (NCH)

 According to the CCPA’s investigation, Rapido’s adverts featured the notice “T&C Apply” in an incredibly small and unreadable font. Even then, the reward was “up to INR 50” and not necessarily precisely INR 50. The promised INR 50 benefit was not actual currency (in rupees), but rather “Rapido coins”. These coins had a seven-day validity period and could only be used for Rapido bike rides. These limitations significantly diminished the offer’s value and essentially forced customers to switch to another Rapido service in an unreasonable amount of time.

Customers were deceived into selecting Rapido by these omissions, which gave the false sense of guaranteed service. Furthermore, the Terms and Conditions made clear that individual captains, not Rapido, were providing the guarantee, even though the advertisement made the bold claim, “Auto in 5 minutes or get INR 50.” By deceiving customers about the precise guarantee stated in the advertisement, this paradoxical position sought to shift responsibility away from the business.

What the Advertising Guidelines Say?

According to the Guidelines for Prevention of Misleading Advertising and Endorsements, 2022, advertising cannot utilise disclaimers to rectify a misleading claim, hide important facts, or contradict the main claim.

In Rapido’s case, the statements “Auto in 5 min or get INR 50” and “Guaranteed Auto” gave the idea that customers would always be charged ₹50 if the car was not delivered within 5 minutes.

Nevertheless, the important restriction that the benefit was limited to “up to INR 50” and only in the form of Rapido coins with a brief validity was either left out or not made as prominently known. The commercial was misleading due to its lack of clarity and concealment, which was a clear violation of the guidelines.