August 17, 2015 By: Michael Cheng Vugo, an in-car advertising company, is providing a new way for Uber drivers to receive electronic tips for their services. To promote a hassle-free experience for customers, the ridesharing giant does not allow tipping through its app. If individuals want to provide additional compensation for the service, they have to fork out cash. According to a recent Vugo blog post, Uber’s ban on electronic tipping is hurting drivers: “A large portion of money cab drivers, and even Lyft drivers make comes from tips, however Uber does not let its drivers accept tips through electronic means, such as credit cards or PayPal, which is the way most rideshare riders prefer to pay for things. Many riders do not carry cash at all, so the ban on taking tips electronically keeps many Uber drivers from reaching their full income potential.” As a solution, some drivers have resorted to adding QR codes to their business cards to encourage voluntary compensation from riders. Vugo is taking the offering one step further by permanently placing a tipping button in the car app. The platform displays the network’s ads and is found in the backseat of participating service vehicles. Lyft, Uber’s top competitor in the ridesharing space, features tipping as one of its core features since the company’s inception. Vugo’s new bitcoin system could not have come at a better time. Uber recently updated its payout schemes for drivers, which caused a decrease of average earnings from $36 to $19 (per hour). “Creating a way for Uber drivers to accept tips electronically seemed like a natural expansion,” explained Vugo co-founder James Bellefeuille. “Uber is trying to change the culture around tipping service professionals. The biggest reason why tipping is important is because your driver is delivering a service.”
Vugo has launched a tipping system for Uber drivers enabling customers to tip their driver using bitcoin, in order to create a hassle-free experience for customers. Uber doesn't allow drivers to accept tips electronically, so if passengers like to tip their driver, it must currently be done in cash. The company is also testing the idea of allowing riders to pay with Bitcoin and then use that money to buy rides from other riders. However, Vugo hopes their app can help Uber-tipping become more widespread.