How Driver Earnings Are Calculated

Created by Okito Support, Modified on Thu, 26 Sep, 2024 at 11:12 PM by Okito Support

1. Base Fare:

The base fare is a fixed amount that drivers earn for starting a ride. This varies depending on the city and the type of service (e.g., car, motorcycle, premium service).
In Metro Manila, for instance, the base fare is typically between ₱40 to ₱50 for car services.

2. Distance Traveled:

Drivers earn additional money based on the distance covered during the trip. This is calculated per kilometer. For example, for every kilometer traveled, drivers might earn between ₱15 to ₱18.

3. Time Spent on the Trip:

For each minute spent on the road, drivers earn a small additional amount to account for time, typically around ₱2 per minute. This compensates drivers for traffic and delays, which are common in cities like Metro Manila.

4. Surge Pricing:

During high-demand periods, drivers can earn more due to surge pricing. Surge rates multiply the fare by a factor (e.g., 1.5x or 2x) during peak hours or in high-demand areas.

5. Tolls and Extra Fees:

If the route includes tolls (e.g., Skyway or NLEX), these fees are typically added to the fare, and the driver gets reimbursed for any such costs.

6. Incentives and Bonuses:

Drivers are often eligible for bonuses or incentives from the ride-hailing company. This can include completing a set number of rides within a specific time frame, driving during peak hours, or maintaining a high driver rating.

7. Commission Deduction:

Ride-hailing platforms usually take a commission from each fare, ranging between 15% to 20% of the total fare, depending on the service and the driver’s agreement with the platform.

Example Calculation:

If a driver completes a 10-kilometer trip that takes 30 minutes during surge pricing (1.5x), with a base fare of ₱50, and per km rate of ₱15:

Base Fare: ₱50
Distance Fare (10 km x ₱15): ₱150
Time Fare (30 min x ₱2): ₱60
Surge Multiplier (1.5x): ₱390 [(50 + 120 + 60) x 1.5]

After the platform deducts its commission (e.g., 20%), the driver’s earnings would be around ₱312 for this trip.