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On Demand Businesses 101

Integrating a Payment API in your On-Demand Service : Part Six of the User Journey Series

This is the sixth part of an 8 part series called ‘User Journey on an On-Demand Business Platform’

There are many questions that need to be answered in order to determine how Payments are going to work for your platform, such as – what different modes of payments to support, which payment gateway or digital wallet to use, to deduct payment at what stage in the user journey. It is also imperative to ensure information security in the on-demand economy while creating a structured approach towards planning payments flow. The following write-up takes you through the payments module in detail:

Payment Flow

Here’s what a typical payment flow looks like:

  • Customer adds a Credit Card to his profile. A token i.e. an encrypted code is created corresponding to each card and is attached to Customer ID. Customer’s payment information is saved in vault at payment gateway’s end.
  • At the time of payment, payment is deducted from customer’s card through payment gateway.
  • Depending on application logic, payment is either split and paid out to business owner’s and service provider’s accounts OR entire amount is credited to business owner’s account.

Payment Stages in the Customer Journey

Payment can be made at different stages in customer journey depending on your business model. Some examples are –

  • After service is performed –  e.g. in a transport application such as Uber, payment is made after the service is completed because fare calculation logic takes into account distance traveled and time taken to complete the ride.
  • When service provider accepts the job – e.g. in an on-demand beauty solution, when customer selects a set of services and time, a request is sent out to registered stylists. Payment is deducted from customer account when a stylist accepts the request.
  • When customer makes booking – e.g. in an on-demand meal delivery application, payment is made as soon as customer selects his food items and places the order.

Payments for On-Demand Services

Receiving Payments

When a customer makes a payment through your app, it will be transferred to your payment gateway account. You will be able to transfer money received in your PG account to your linked bank account later.

You can either create a merchant account or a marketplace account with your payment gateway. A merchant account can only receive payments via PG, whereas, a marketplace account can do both i.e. receive and make payments via PG. If you choose a business model wherein you want to receive complete payment made by customer and pay your service providers later, you will need to create a marketplace account. However, if you choose to go for a split payment system, you may go for either a merchant account or a marketplace account.

Paying your Service Providers

SPs can add their credit card details on their profile on service provider’s app. This will again be saved in the form of a token. OR you may take their CC or Bank account details offline and add those in admin panel corresponding to each service provider.

Payments to SPs can be made:

  • After fixed intervals – You may choose to pay your service providers on a weekly/bi-weekly/monthly basis. System will keep a tab on payments accrued by each service provider and you will be able to view this information and make payments directly from admin panel.
  • Immediately  – Payment gateways such as Braintree and Stripe Connect allow you to split the payment received from customer into two parts and simultaneously direct these split payments to Braintree/Stripe account of business owner and CC / Bank Account of service provider respectively. As per client’s requirement, logic will be built into backend code to calculate respective payouts for service provider and merchant for each customer transaction and these values are sent to Payment gateway API to make required payments.

Note: Above method does not mean that payment will be credited to service provider’s accounts instantly. It only means that from your platform’s end, payment to SP’s account will be initiated as soon as it is deducted from customer’s card. It may however take 4-6 days for the payment to show up in SP’s account depending on their bank’s processing timelines.

Available Payment Gateways

This largely depends on what options are available in the service area of your application. Some implementations we have done in the past:

  • USA – Stripe, Braintree, Paypal, Authorize.net, Heartland
  • UAE – Payfort
  • India – PayU, PayTM
  • Bermuda – PayEasy
  • Nigeria – Firstdata
  • Uganda -PesaPal

Integrating Payment Gateways

Most payment gateways provide a mobile SDK (software development kit) and offer native mobile libraries for Android and iOS. Our development team will use these libraries to integrate the payment gateway with your solution.

Please note that in some cases (e.g. Stripe), these libraries provide their own payment UI screens and can not be customized. Braintree allows UI customization.

PCI Compliance

It is NOT necessary for your credit card to be PCI compliant.

Anyone who accepts credit card payments needs to comply with latest PCI DSS rules, but this is covered by integrating your payment system with a PG. Because when you use a payment gateway, its libraries send credit card data directly to PG’s servers, where this is converted to tokens – thereby eliminating the need to store sensitive credit card data on your servers. You can charge these tokens later in your server side code.

Cost of Integrating a Payment Gateway

There is no cost involved in setting up or integrating a payment gateway to your solution. They take a percentage of transaction amount. e.g. Braintree and Stripe charge 2.9% + $ 0.30 per successful transaction.

Some payment gateways set a limit on minimum transaction amount e.g. Stripe requires a minimum of $0.50 for each charge.

Processing Refunds

Business owner can go to merchant PG account and initiate a refund to customer account.

Data Security

  • Tokenization – Customer payment information is converted into an encrypted code and saved in a vault at PG’s end. No payment information is saved on your application servers.
  • All APIs of payment gateways are on SSL, thus providing an encrypted communication link for API requests and responses.

Additional Features – Scanning your Card

By using card.io, i.e. a free Android / iOS SDK provided by PayPal that can be integrated to your solution to enable scanning credit cards in your mobile app.

Difference between PayPal and Stripe/Braintree

PayPal is a wallet, whereas Stripe/Braintree are payment gateways. We recommend using a PG over a wallet because in case of a wallet, there is no tokenization. A customer will need to enter his credit card information every time he makes a purchase through your app. If you are using a PG, his payment information is securely saved and does not need to be re-entered at the time of purchase.

Testing your Payment System

Testing is done in sandbox environment for which integrated PG provides a test credit card that is linked to your product key.

Other Notes:

In our experience, we have found that Customers’ Amex cards do not directly work with Braintree and Stripe PGs. Merchant or the business owner has to submit a request to Braintree or Stripe to enable processing of these cards on their Payment Gateway.

Go to Part 7/8 : ‘How Reviews control Quality on On-Demand Platforms’ here >>>

Get in Touch with us if you are looking to create the next big disruption with your on-demand business idea! We have got your tech covered. no worries. To know more about Juggernaut, go to the homepage  .

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79 Comments »

79 Responses to “Want to develop an app like Uber? Know the cost and other details“

  1. Shaw says:

    Need a übe type app

  2. Ajay Deep says:

    Hi Shaw. Thank you for your interest. Our sales team has sent you an email. You may take it forward from there. Cheers!

  3. I wan’t uber like platform but for another kind of business. real estate?

  4. Pac says:

    Hi, I need app like uber but with little changes

  5. shane says:

    Uber like app for delivery service

    • Ajay Deep says:

      Hey Shane,
      Uber like app for delivery service seems to be a great idea. Someone from our sales team will be in touch with you through email. You may take discussions forward from there.
      Cheers!

  6. Antoine says:

    Hi Ajay – What assurances one has that the app developper would not simply take an inovative idea and create its own app? An NDA, despite its loopholes, is a legal instrument that prevents the “Disclosure” not the copying or the taking over of an idea. Your open mindness on this delicate matter is appreciated.

    Cheers,
    Antoine

    • Ajay Deep says:

      Hi Antoine,

      We value intellectual property very highly. As and how it may be required, we are open to discussing transparent and clear clause/s that would prevent us from developing similar application for a time period. The developers working at our organization are hired after a verification process and are legally bound not to indulge in any such activity. Further, we have sent you a copy of our NDA. You may go through that and reply to the email. Rest assured, Juggernaut will be your best choice to develop an app like Uber in any industry segment. Let’s take it forward.
      Cheers!

      • Ahmed says:

        Hi Ajay, I came across your articles…I really like what you write about on demand tech..very helpful and inspiring…about this point specifically I’m so interested to know more.can you send me a copy of your NDA.
        We might discuss something even more interesting starting from this point

        My regards,
        Ahmed

        • Ajay Deep says:

          Hi Ahmed. Glad that you liked our content. We focus on providing value to our readers. Our team has sent you an email. Just reply back to take the communication further.

  7. tony hakim says:

    you guys are world class

  8. Milind Shah says:

    Hi Ajay,
    I need an app same as Uber. what will be the cost? and can you show me if you have any such app on itunes?, so that i can download and try.
    Milind

    • Ajay Deep says:

      Hi Milind,
      Being a leader in on-demand space, we have developed a number of apps in various business verticals for both android and iOS platform. Our sales team will get in touch with you through email and provide you with all the required info.
      Cheers!

  9. Wafir says:

    Do you guys do projects for the Middle East?

    • Ajay Deep says:

      Hey Wafir, of course we do!
      In fact, the Middle East region is booming with startups in the on-demand sector. We’d love to work on your project. Just sent you an email to initiate the conversation. Let’s take it forward through that.
      Cheers!

  10. nitesh says:

    hi need a app like uber let me know

  11. Subomi says:

    Hi,

    Need an app like Filld On Demand Gas Delivery.

    But with no payement option for now since that needs a lot of security and will be expensive. I’m bringing Filld’s business model to Africa.

  12. Parul Singh says:

    Are you guys involved in developing all kinds of apps or its just limited to the apps like uber?

  13. Jesse says:

    Hello, I would like to get more information on developing an app similar to Uber but for providing a standard service. It is a very saturated industry and simplifying access to such service I think can very well find its way in the mobile App world. As like previous comments left I too am concerned and question if my idea can be taken or copied.
    Thanks for your time and eager to hear your response.

  14. Can you send me a copy of your NDA? I am most concerned with this and how it works and what is the time line of the NDA?

    My idea revolves pretty much around UBER and but is not related to rides.

  15. william says:

    Hi AJAY or juggernaut , am interested in developing an app which is as complex as uber or a little more complex but nothing like uber. would like to get in touch with you via email. so reach out to me lets discuss. thanks.

  16. Peter says:

    Hey Juggernaut, I’m interested in developing a service within the On-Demand economy, with some added variables that could prove difficult to navigate, but can definitely be done with the right expertise. Really in the ideas stage at this point, but I can definitely see a road to success and I’d love to talk with you guys regarding my options and so on. Thanks.

  17. please give the ideology and working of the app,and how to develop an app like uber for autos and taxi which could be affordable for all class of people

  18. King Spesh says:

    Hello Ajay, I have an idea for a transportation app but have no finances nor the expertise to pull it off, I have made a thorough research on it and its big, please contact me via email to discuss it.

    Kind regards,

  19. Amaro says:

    Hi Ajay:

    Do you have a uber alike plataform already? I’ll be interested on getting such a service from you and your team

    Thanks

  20. Daniela says:

    Hi Ajay,
    I am looking to outsource (hire or partner) the development of a new business idea that can use this kind of structure. Would your team shoot me an e-mail so that I can assess whether Juggernaut may fit into the picture? Thanks!

  21. Jon says:

    Hi Ajay,

    Looking for a Uber like app in RSA, also have concerns about NDA, costs and durations.
    Please could you send me a copy of your NDA and any other info that may assist me in my choice of Developer.

    Please also send me through a direct contact so that i may contact by telephone if possible.

    Thanks Jon

  22. sudheer says:

    Hi, i want to start a business on GPS based. It likes UBER r OLA but not in transportation mostely deals with FMCG. Can u please email me the details.

  23. Thanks for this….i also like to develop Uber type of apps. Please inform me what is the exact cost to develop in India.

  24. i need an app developer just like uber..
    can u help?

  25. Daho says:

    I would like to have an estimat for uber like platform thanks

  26. Carlos says:

    Hi im interested in an app with similar UBER features

  27. Jordon says:

    I need to be able to have clients send their location to a computer at our office so we can send a car to them,

  28. Sunny says:

    Would like to make an app please contact me

  29. Joniel says:

    Hi Ajay, I have an app in my mind same as Uber and I would like to discuss it further. Hope to hear from you soon.

  30. Tim says:

    What are your rates and can you refer me to a source to develop a solid NDA and IP lawyer before we get the ball rolling?

  31. MJ says:

    I’m interested in an uber like app. Can you help? Thanks!

  32. hasan says:

    I need a app like uber county base

  33. Ami Khan says:

    Hi Ajay,

    I have a business idea/proposal and need to work out how much it will cost to develop an app like uber (but also maybe have some sort of video link too). I plan to pitch to investors by Q316 so am working on the Financial model now.
    What credentials do you have in this field and could you also let me know what guarantees you can provide in terms of ensuring that any plans I share with you are confidential? Thanks in advance!

  34. Chris Dre says:

    Interested in UBER-like app with some changes. Please contact me with NDA. Thank you.

  35. Mark says:

    Thank you. Very informative and well-structured article. I think it would be helpful for everyone. Maybe you should try to add it to the Wiki page about Uber: http://getsmall.link/6eb1a0e8

  36. Rigoberto paz says:

    We are in los angeles trying to start ul a bussiness like uber can you guys helps out.

  37. Barkaat Ahmad says:

    Hi

    We like to get an estimate on an Uber like app. Would you be able to email me a ball park estimate on development cost, timeframe and on after sales service/enhancements.

    • Ajay Deep says:

      Hi Barkaat,
      Thanks for reaching out. Our sales team will be in touch with you through email and you may take the discussions forward from there.
      Cheers!

  38. mugambe ramathan says:

    hi,am in east africa, am planing on setting up abusiness more like uber hope we can discuss more

  39. Stephanie says:

    Hi Im interested in developing an app like uber for another service but same concept as uber can you please provide me with costs thank you

  40. Amr Gadalla says:

    Hi Team,
    I want to ask about the details of a program like Uber, but of course on a much lower scale (10-20 cars), including the cost and the maintenance fee , and if there is any fixed sets to be fixed in the cars.

  41. Akshay Kumar Dixit says:

    Hi I also want to know about the cost of making such an app

  42. Aditya says:

    Hi Ajay
    I am thinking to make website like uber but it will be little different then uber. It will be like pre reservation in app and customer can track their car. It will be limousine service but all pre refer action through app. Nothing else.

  43. Mohamed says:

    We are in NJ. And we like to start company like Uber or lyft can u guys helping out by telling what the cost for the app and start the company

  44. David says:

    Please call me to discuss my concept for development.
    David
    9173646218

  45. Sayo says:

    Hi
    I will like to get an estimate on an Uber like app. Please email me a ball park estimate on development cost, timeframe and on after sales service/enhancements.

  46. Hello,
    I am looking to develop an app similar to Uber but will carter a totally different service.
    I like what I read on this page and will love to touch base with somebody in your company.

  47. Pathrose says:

    We would like to get an estimate on an Uber like app. Would you be able to email me an estimate on development cost, timeframe and on after sales service/enhancements.

    Reply

  48. Jignesh patel says:

    Hi
    We like to get an estimate on an Uber/ola/porter like app. Would you be able to email me a ball park estimate on development cost, timeframe and on after sales service/enhancements.

  49. Jignesh patel says:

    i need to detail about this uber/ola/porter application
    who make this type of application?
    its application total estimste and how to operate?

  50. Nuria says:

    Hi I need help trying to making a app like the uber app but we have our taxi company already it will be more easy if we have an app can you help please

Leave a Reply

Want to develop an app like Uber? Know the cost and other details

How much does it cost to make an app like uber

How much doest it cost to make an app like uber

How much does it cost to develop an app like Uber? We come across this question almost always when we think about app development for building apps like uber. The answer always is – It depends!
Uber’s business model has given rise to a large number of On-Demand Platforms being adapted for different verticals. The demand for taxi apps like uber and uber clone app has grown eminently in the recent times. Many entrenched industry value chains stand to be disrupted. The online-offline nature and involvement of multiple stakeholders make these platforms difficult to design, master and scale for uber like app development for your business.
Related Reading – The Uber Business Model 
Entrepreneurs and enterprises looking to build uber like apps for different verticals often find this analogy easiest to articulate and hence the genesis of the question. There are several variables associated with getting to a correct estimate to make an app like uber. Let’s have a quick look at these variables to understand what goes into designing an Uber for X platform. I am confident this will also lead to a better appreciation of why we as Juggernaut took a modular approach and designed an MBaaS (Mobile Backend as a Service) architecture to create a winning value proposition for entrepreneurs/enterprises looking at making an uber like app / uber clone for their business.
Generally the cost for the initial MVP for an app like uber is upwards of $100k-$300k, however while taking the Juggernaut approach it can be as low as $40k – $80k. Read more to learn how :
A) Is your business model exactly like Uber? If not, how does it differ from Uber?
Uber for X can be best described as a platform looking to deliver a product or provide a service On-demand with demand being aggregated online and serviced offline. But there are so many variations that can come up when we start analyzing different implementations in this field.

When we talk about an app like Uber:

  1. We can assume – supply is loosely bound to the platform and we are merely aggregating the supply.
  2. Demand is not scheduling the product/service for a time in the future and everything is instantaneous.
  3. Demand is not choosing the service provider and he is being allocated the one based on his choice and other variables.
  4. Service/product that we are talking about has a standardized flow and doesn’t involve customer making a selection across lot of different variables.

Clearly, for most of the entrepreneurs their business model will have many stark differences from Uber’s business model cited above. These considerations have a direct impact on how you deal with decisions related to identity, scheduling, matching, payment, etc. while designing the product and thus the cost associated with defining the MVP.

Related Reading  On-demand startup in mind? Success depends on these planning factors – Venture Beat

If you are in the process of defining the contours of your business model and making these design choices and are looking for a more exhaustive take on the topic – download this free eBook that talks about how to finalize the business model for your On Demand Startup – Ebook: Understanding the On Demand Business Model

B) What is the business vertical you are trying to target?
Is it a taxi app like uber business or an On-Demand platform designed for some other vertical? When you are trying to find a solution to help your existing taxi/limo business with an Uber like application development experience, there are many companies providing white label solutions. When you start going broader to say, ground transportation (shuttle/event/hailing solutions directed at children/senior citizens/corporates etc.) or beauty or home services or delivery and so on, things start becoming more complicated and it is difficult to find a script based approach that works.

We have been grappling with this problem for the last 24 months and have come up with a top down approach as a solution. The basis is that there are certain modules – matching, scheduling, tracking, payments, reviews, notifications, aggregation and signup that form the backbone of any such platform. So we have created backend code blocks or an MBaaS based architecture structured to take care of most of the use cases that can be thrown by an On Demand Business Model. For more information on functional choices that go in defining each of those modules – download this eBook that talks about the Building Blocks for On-Demand Technology.

The underlying premise is that the front end needs to be custom developed. Leveraging the proven backend architecture ensures that we are not reinventing the wheel when it comes to deeper customizations/corner cases.

Uber like app development

Uber like app development

C) Evolution of On-Demand Platforms
When we talk about an app similar to Uber, it is helpful to keep the general evolutionary framework associated with all startups in mind. It is a fact that all business apps like or unlike Uber have to go through the 4 stages mentioned below. But the fact that most On Demand platforms are associated with network effects/playbook evolution/solving the initial chicken and egg hurdles, etc. the case for a clear understanding of these stages is much more important. Question then becomes are we looking to validate the business model that is doing less than 1000 transactions a day or are we talking about a system that has already scaled to multiple geographies built on top of a highly optimized logistics framework.

How to make an app like uber

How to make an app like uber

Focus areas during different stages of platform evolution are different. The first hurdle is getting a functioning product to the market that aces the core interaction. Once the MVP is launched its often a race towards achieving that product-market fit which in itself might span multiple sprints. Once the product market fit is in sight, the next hurdle is getting the unit economics (Customer Acquisition Costs/Lifetime Values) right while constantly improving cohort data. This phase generally involves lot of focus on building the analytics capabilities.

Total cost of developing an on-demand app like Uber:

By now it should be clear that the cost of making an app like Uber depends on numerous factors. But here’s an attempt at the estimate. Building an MVP for an On Demand Platform involves creating web/mobile interfaces for both supply and demand. Add to this the fact that native experiences are the expected norm leading to parallel development efforts if we chose to build both for iOS and Android. The other important component is the nerve center/admin panel that doubles up as a CRM and a Dashboard to control some of the critical operations. Everything is glued together by the APIs that operate on top of central databases and control logic – part of the backend framework that runs on cloud.
Assuming the platform architecture is scalable and is able to handle 500-1000 transactions a day right away we are looking at an upwards of $100k-$300k effort for an initial MVP. Variations in the ball park primarily are on 3 accounts –
1. Number of stakeholders
2. Number of platforms that are part of the initial launch
3. Complexities in the business model
4. Geography/ Region out of which your development team operates or engineers the product. Per hour rates vary from $20 -$60 (parts of India/Eastern Europe/South East Asia) to $80 -$150 (parts of Western Europe/US)
With a modular approach that takes advantage of pre-built IP, we at Juggernaut are able to reduce the time and cost involved by around 30%. In addition, since Juggernaut’s engineering teams are based out of India we bring a huge cost arbitrage to the table while still ensuring smoothness in communication generally associated with in-house teams. The engagement processes have evolved over more than 5 years of distributed product development. All in all the costs for an MVP while taking the Juggernaut approach can be as low as USD 40k to USD 80k. But more than the cost advantage the bigger value proposition that we bring to the table is experience drawn from doing more than 50+ On-Demand Platform in different geographies and domains. This makes the approach consultative wherein at every step, we draw from the playbook of many successful implementations that we have been associated with directly and indirectly.

Want to get an accurate cost for your own idea? Get in touch with us now!

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