What expenses should you be aware of if you want to become an app taxi driver?

Many ride-hailing platforms (meaning all ride-hailing platforms) advertise themselves by promising high earnings and an instant start. However, the expenses that incur with getting started often take new aspiring taxi drivers by surprise.

I’ve written down everything that the law and the passengers require of taxi drivers. I am talking about expenses related to the service provider card, vehicle card, taxi license, car care, special categories, health certificate, and insurance.

Service provider card

The service provider card is an easy document to acquire and it costs you 38 euros. It takes the local authorities 7 days to process the application and issue a permit that allows you to provide a taxi service. Assuming that you don’t have a provisional driving license (meaning that you have had the right to drive a power-driven vehicle for more than two years) or some valid penalties.

Vehicle card

A prerequisite for the vehicle card is either a service provider card or a taxi license and you have to pay the state 20 euros for it. Keep in mind that interdependent permits can not be processed simultaneously, which means that the whole application process can take up to two weeks. Of course, it all depends on how accommodating the officials are. I have made sure to call them every time I submit the application to kindly ask them to process it faster. In my experience, it tends to cut down the processing time.

However, if you want to do things by the book, it’s important to think in advance about which taxi license you’ll be using before you apply for the service provider card. We’ll cover this in the next section.

Taxi license

You didn’t know that you need to pay another 64 euros? Welcome to the club! About half of the drivers I’ve met within the last year were in for that surprise as well and had to apply for the taxi license retrospectively.

In fact, all ride-hailing platforms are equally to blame here – they all send their new drivers instructions on how to apply for the service provider card and the vehicle card, along with information about the platform’s taxi license, but it’s not worded very clearly. Only once you’ve already acquired the service provider card and the vehicle card (if you plan to use your personal card to provide the service) will Bolt and Uber tell you very clearly that they are not, in fact, carriers, but simply act as intermediaries between the customer and the driver. After that the drivers have no choice but to apply for a personal taxi license retrospectively, as is apparent from the Register of Economic Activities. However, this means that the already existing service provider card does not include information about the taxi license and you can expect the fines to start pouring in as soon as the local authorities will get the right to give them.

Only the drivers who start providing services for a company that already owns a taxi license can bypass the 64 euros.

Car care products

How often do you deep-clean your car? Once a month, once a year? It will no longer matter once you become a taxi driver because you’ll realize soon enough that your car will now be dirty all the time as customers can’t keep it clean.

However, there’s a simple solution to this. Arm yourself with a microfiber cloth, a cleaning brush (toothbrush is too small), an alcohol-based cleaner and a care product that’s suitable for cleaning textile, plastic and leather. Furthermore, calculate how much you usually spend on cleaning the exterior and double that sum. We’ll dive into car cleaning some other time, but I’d say you need to be ready to spend at least 35 euros on car care supplies.

Pet transportation and child safety seats

In case you didn’t know already, the competition within the taxi business is fierce. Every customer is precious and there are never enough of them. If you are willing to take on categories with extra risk, such as Pets (Bolt only) and Child Safety Seat (Bolt), I recommend you think about mitigating the corresponding risks in advance. I keep a child seat and a blanket for pets in my trunk at all times. In fact, customers from these categories are most likely to leave a tip. In my opinion, it was worth investing 11 euros into a booster seat and a blanket as these things already paid off after 2-3 special category orders.

Health certificates

Although a driver license and an accompanying health certificate are valid for ten years, subsection 101 (4) of the Traffic Act states that taxi drivers need to renew their health certificate every five years. None of the ride-hailing platforms check if you actually have it, but if the authorities ask you for it, you need to be ready to pay up if you don’t have a valid certificate. Therefore, since drivers with less than two years of experience are not allowed to provide taxi services, it is very likely that you do have to cough up an additional 25 euros.

Insurance

Insurance companies ask about the intended purpose of the car when drawing up policies. If you tell them that your car is for personal use, but the Register of Economic Activities states otherwise, your insurance will be triple after your current motor third party liability insurance or casco insurance ends. The policy of the taxi driver who caused the accident can also be unilaterally terminated if the driver lied about the intended purpose of the vehicle. Currently Cachet offers the best insurance options for app taxi drivers as the insurance premium is calculated based on the actual workload and you pay a higher price only for the hours you actually spend providing the taxi service.

In conclusion

All ride-hailing platforms require only a service provider card and a vehicle card from a new driver, which amount to 58 euros in total. But the law requires a few other things from taxi drivers as well, such as a taxi license and a health certificate, even if ride-hailing platforms don’t pay attention to those as they don’t fall directly under the responsibility of the platforms. Nevertheless, you must be ready to acquire the taxi license as well, which costs 64 euros. Which means you need to be able to invest at least 122 euros instead of the advertised 58 euros. Alternatively, you can start working for a taxi company and simply rent a car – then you only need the service provider card, which costs 38 euros.

I advise you to consider all the risks related to providing ride-hailing services before you get started. And if you do decide to commit to it, it’s worth putting in around 183 euros for all the things listed above and get yourself a good app taxi insurance as well.

Safe rides!

Kaspar the Driver