Introduction to the Gig Economy
The “Gig Economy” primarily relates to temporary, flexible jobs offered by companies that usually hire independent contractors and freelancers as against regular onsite employees. The instability and ambiguities introduced by the events of corporate layoffs and the practice of services’ offshoring have diminished regular employment avenues.
The What: Fragile State of the Unskilled Indian Gig Economy Workforce
A considerable volume of the workforce (skilled, semiskilled, and unskilled) is willing to embrace working on a temporary or part-time basis to offset the issues and barriers lately presented by the regular job market. Coupled with this is also the presence of unsuitable remuneration levels offered by the ride-hailing platform companies to the gig economy workforce (the cab drivers) in India. The prevailing remuneration practices have led to challenges facing the economically and socially fragile section of the Indian gig economy workforce (lower illiteracy and confined earning potential) typically recruited to discharge services as independent contractors for such mobile app-based cab aggregators.
The proponents of the “Gig Economy” may argue that the results of this gig (unskilled workforce) ecosystem are affordable and efficient services (e.g., Uber or Ola) for the service subscribers. That may sound encouraging. If yes then why the contracted workers aren’t equally satisfied with their working terms and remuneration?
It is also worth citing the strike demonstrations (March 19, 2018), initiated by the OTU (Ola, Taxiforsure, and Uber) Drivers’ and Owners’ Association in Mumbai and New Delhi. The following (October 22, 2018) indefinite strike demonstration in Mumbai initiated by the Maharashtra Rajya Rashtriya Kamgar Sangh was also alarming. The bone of contention in both the events was falling cab drivers’ income levels offered by ride-hailing aggregators. Notably, most of the cab drivers couldn’t even afford participating in the strikes as it would lead to a total loss of their daily earnings.
The Why: The Unskilled Gig Economy Workforce’s Contention
The socioeconomic context of the terms of association and remuneration policies (which, in the case of cab drivers, is merely a net disposable income averaging just 30% of their daily earnings at the end of the workday—after keeping aside a proportionate amount for car loan repayment) compliant to which the independent contractors (mostly unskilled cab drivers) are compelled to operate have been failing miserably in satisfying even the most basic earnings expectations of the human capital. Working as drivers for the mobile app-based cab aggregators seemed lucrative initially as they offered strong incentive earnings—with the then low rate of aggregator commission (10%). All of it soon waned as the supply of drivers skyrocketed, now rendering them helplessly working as price takers under the burden of a car loan (availed in some cases after selling their ancestral land) coupled with the current aggregator commission of around 30%.
Moreover, the drivers receive their money a (gruelling) day later in case of payments made via mobile-wallets. This has led to a cash-on-hand crunch preying on the drivers, partially attributed to the influx of cashless payment systems for subscribers, wherein the cab drivers end-up having even lesser cash-on-hand, not enough to afford fuel (let alone managing their family finances comfortably). As a result, the gig economy workers are left to survive at the mercy of the cab aggregators’ unreasonable remuneration policies.
The How: BON: The Credit Solution for Marginalised Indian Gig Economy
To improve the unskilled Gig Economy workforce’s finances and reduce the acute cash crunch faced by the cab drivers’ community (requiring speed payments), a solution designed on the same apparatus of technological innovation is necessary.
So, what’s the solution to regularise credit finances for the 9, 00,000 cab drivers (per the data published by Statista for July 2016) in India, such that it can offset the hardships of a day’s delay in payment?
Welcome the BON Card for short-term credit to the gig economy workers. BON Card comes with an expense monitoring app—a “Work Now, Pay Later” payment feature for the gig economy workers across India and SE Asia. The Transportation and Logistics, E-Commerce, Hyperlocal, and 2-sided marketplaces’ merchants can issue BON Cards (issued by MasterCard) to manage their workforce’s interests.
For BON Card Application: 022-39698234 or firstname.lastname@example.org