December 11, 2017 / 11:29 PM / 7 months ago

Uber fights ban on cash payments in Mexican state

MEXICO CITY (Reuters) - Uber Technologies Inc said on Monday that it had appealed regulations that have barred it from accepting cash fares in the Mexican state of Puebla, in a new challenge to clampdowns on the ride-hailing service in Latin America.

FILE PHOTO - The Uber logo is seen on mobile telephone in London, Britain, September 25, 2017. REUTERS/Hannah McKay

Uber stopped accepting cash payments in the Mexico City-adjacent state on Friday, responding to demands from state authorities, and filed an appeal to a federal judge against the regulation the same day.

But the company said cash fares are crucial to reach Mexican consumers who do not have credit cards.

“To continue being a transportation option for people who pay in cash and to maintain the earnings of driver-partners, the company has decided to take, as a last resort, the corresponding legal actions and request an appeal,” Uber said in a statement on Monday.

Authorities from Mexico to Brazil have tried to rein in Uber’s use of cash payments, in Brazil because of concerns that cash makes drivers targets of crime, and in Mexico because of worries that allowing cash puts Uber in direct competition with traditional taxis.

In Puebla, specifically, lawmakers responded to the murders of two female college students who had used ride-hailing services with new rules in October aimed at improving companies’ vetting of drivers.

The rules specify that the companies should use “electronic payments,” but Uber continued offering users in the state the option to pay in cash after the law went into effect on Nov. 7.

Uber maintains that the language in the law does not expressly ban cash payments.

A spokesman for Puebla’s Secretary of Infrastructure, Mobility and Transport did not immediately respond to a request for comment.

In addition, Uber is appealing a provision in the law that holds the company and other ride-hailing companies directly responsible for what happens during trips, saying it violates its right to “due process.”

Uber has said authorities should conduct investigations to determine responsibility on a case by case basis.

Uber is also appealing a provision in the law that requires the company to give authorities access to the platform, citing privacy concerns for riders and drivers. The company will continue to cooperate with criminal investigations, a spokesman said.

Uber faces curbs on its activity in other Mexican states. Last month, legislators in Quintana Roo, the southeastern state that includes Cancun, said they were also considering a proposal that would bar drivers from accepting cash and set minimum value and age criteria for the cars used for trips.

Reporting by Julia Love; Editing by Frank Jack Daniel and Mary Milliken

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