WHY THE ILLEGAL SERVICE STILL THRIVES
Singapore’s public transport system is often hailed as world-class, but the consistent demand for illegal carpooling suggests that there may be gaps in the transport system that need to be addressed, transport analysts said.
Passengers like it because it is much cheaper than legal options, while the drivers go for it because they do not have to pass through regulatory checks, undergo special training or pay third-party fees.
As an example, Associate Professor Walter Theseira from the School of Business at the Singapore University of Social Sciences (SUSS) said that compared with private-hire driving, which involves more stringent regulations, illegal carpooling drivers can offer lower prices because they do not have to pay commissions or platform fees.
Private-hire drivers must also obtain a vocational driving licence, ensure their vehicle meets safety and insurance standards and comply with platform regulations, he added.
“These additional requirements increase their operating costs, making their services more expensive. In contrast, illegal carpooling operators can bypass these costs, allowing them to offer cheaper fares.”
He also said that this is particularly relevant for Malaysian drivers offering the service to Singaporeans who want to cross the border, since they benefit from lower operating costs such as the use of Malaysia-registered vehicles and cheaper petrol.
Singapore- and Malaysia-registered taxis are the only licensed providers of cross-border services.
LTA requires Malaysia-registered taxis to obtain a Public Service Vehicle Licence and an ASEAN Public Service Vehicle Permit to provide cross-border point-to-point services.
Assistant Professor Terence Fan from the Lee Kong Chian School of Business at the Singapore Management University noted that geographical factors are another key driver of this trend.
Although Singapore’s public transport system is generally efficient and covers many areas, there are still pockets that remain underserved despite the availability of buses, he said.
“These buses may not reach the specific destinations that people need or there might be lengthy transfers. For those living near their workplaces, carpooling could be seen as a way to reduce their travel time.”
Asst Prof Fan also pointed to the lack of affordable transport options during off-hours such as after midnight when public transport stops operating and ride-hailing platforms sometimes start activating surge pricing. This then creates the demand for informal carpooling.
Still, the experts note that passengers who choose to Telehitch should be fully aware of the risks.
Associate Professor Raymond Ong from the National University of Singapore (NUS) said that insurance coverage is not provided for these illegal rides. And some of these drivers might even be operating without a valid licence, leaving passengers without protection.
Assoc Prof Ong’s research interests include multimodal transport infrastructures and operation.
“There’s no way for insurance to cover claims in the event of an accident. While passengers may think they’re saving money today, if something goes wrong, there’s little recourse,” he warned.
He pointed to GrabHitch as an example of a regulated service that offers insurance and protection.
In contrast, informal carpooling provides no such safeguards and if a dispute arises between a passenger and driver, there is no clear way to resolve it “unless it becomes a criminal case”.
Speaking of other risks, Ms Yeo, the Pasir Ris-Punggol GRC MP, told CNA TODAY: “Chat groups lack the ability to verify user identities since they do not collect member information.
“In contrast, sanctioned platforms maintain recorded identity records for both drivers and commuters, ensuring greater accountability and safety.”
Ms Yeo is also adviser to the National Private Hire Vehicles Association and the National Taxi Association.
The transport experts acknowledged that enforcement of informal carpooling is challenging because, in practice, it is difficult to monitor every point-to-point transport arrangement and check every vehicle.
For example, as the experiences of Mr Jun and Mr Rhys has shown, if the authorities conduct a roadblock and question drivers, they can easily claim to be giving a ride to a friend, making it hard to prove otherwise.
Assoc Prof Theseira of SUSS said: “This is why such markets continue to operate. They thrive in regulatory grey areas where full enforcement is nearly impossible. Looking back at Singapore’s past, illegal taxis were widespread for similar reasons.”
He stressed that, ultimately, regulations must strike a balance between safety and practicality.
For instance, a stricter system that requires daily vehicle inspections would improve safety, but also impose unreasonable costs.
“Singapore has set its regulatory standards at a specific level and while stricter regulations could reduce illegal activity, they could also make legal transport services costlier or less accessible. This trade-off is a key challenge in enforcement.”
