Flywheel gives taxis high-tech boost with new payments app

Flywheel is now offering passengers a way to pay for a taxi hailed from the street using a smartphone app, a move that helps pull traditional city cabs further into the mobile age as Uber continues to threaten their very existence.

Redwood City-based Flywheel on Thursday announced a new feature that givers riders a way to pay for a cab they’ve hailed on the street simply by opening the Flywheel app on their smartphone – no need to take out a wallet to search for cash or a credit card.

Flywheel is a taxi-hailing app that allows passengers to order a city cab – the company partners with the dispatch services for cab fleets such as DeSoto. But the company recognized that passengers were still using street hails – particularly on busy corners – and didn’t always want to stand around waiting for the cab ordered from their smartphone. But, passengers also don’t want the hassle of fumbling for cash or waiting for a credit card to be processed when their ride is over.

The ability to pay for a cab hailed from the street using the Flywheel app is yet another play to help traditional cab drivers battle on-demand ride apps such as Uber and Lyft, which dispatch not medallioned taxis but community drivers to pick up a passenger. Uber and Lyft have begun to erode the taxi industry, particularly in Silicon Valley and New York.

After hailing a cab from a street, a passenger can open the Flywheel app, and the app detects the speed at which the passenger is moving and, at the same time, detects the location of all the cabs in San Francisco. Using that information, the app determines that the passenger is already inside a cab and will not order a new cab but will simply jump to the payment option. The app stores the passenger’s credit card information.

“All day long you could be walking in and out of cabs and you don’t have pull out your wallet,” said Flywheel CEO said Rakesh Mathur.

Passengers need to download a new version of Flywheel to use the payment feature, which is now available in the app stores.

This feature only works in city cabs that use the Flywheel app. About 1,600 out of the 1,800 San Francisco cabs use Flywheel, Mathur said. Yellow Cab is the one company that has refused to work with the app. Most taxi companies have embraced it because it helps them compete with Uber and Lyft.

Flywheel grew tenfold in 2014. And the app recently got a boost when in February it partnered with DeSoto cab company to rebrand more than 300 of their cars to read “FlywheelTaxi.” The cars are painted red, Flywheel’s color.

Flywheel makes money by taking a 10 percent cut from ride fares through its app and charging passengers $1 per ride. Flywheel doesn’t do surge pricing — which both Lyft and Uber do, much to passengers’ discontent — but the app also includes a “guaranteed tipper” feature, which riders can select as an incentive for a cab to pick them up. The feature adds a tip of to the final bill, so the rider is committed to paying more, but Mathur said ride completion rates have increased to nearly 90 percent since Flywheel added that feature. Cabs are more likely to pick up a passenger if they know ahead of time they’ll made a tip, he said.

After also launching in Portland, Ore., on Thursday, Flywheel now operates in six cities. San Francisco is the only Bay Area city it serves, but Mathur said a South Bay expansion was coming soon.

Image courtesy Flywheel

 

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