Ofo gets bike-sharing license from Singapore regulator, but questions ‘insufficiency’

Photo credit: Jake To / Unsplash

Ofo has received the green light from Singapore’s Land Transport Authority (LTA) to continue operating its bike-sharing service in the city-state, the Chinese company has confirmed.

The agency granted Ofo a license under its new regulatory framework for bike sharing, which is aimed at keeping dockless bikes parked in designated areas and preventing them from causing obstructions or being a public nuisance.

The LTA said last week that it will begin implementing a QR code-based parking system for dockless bikes, requiring users to “check in” at designated parking spots. Users who fail to scan QR codes to end their ride and park their bike properly will face fines and even lengthy bans for repeat offenders.

The bike-sharing firm welcomed the LTA decision, saying the license will provide it with “operational certainty.” But Ofo also indicated that the license’s provision allowing it to operate a fleet of 25,000 bicycles “will not be sufficient to facilitate the high demand for bike sharing” in Singapore.

Successful and unsuccessful applicants

Ofo is one of several bike-sharing apps that applied for the new license, along with Chinese archrival Mobike – which was acquired by Meituan-Dianping in a US$3.4 billion deal earlier this year – and Singaporean firms Anywheel and SG Bike.

In addition to Ofo, the LTA has granted full licenses to Mobike and SG Bike, to operate 25,000 and 3,000 bicycles respectively. Anywheel and GrabCycle – the bike and e-scooter aggregator launched by Grab earlier this year – have been given sandbox licenses to operate up to 1,000 bikes, while Chinese firm Qiqi Zhixiang obtained a sandbox license for 500.

Singaporean startup GBikes had its license application rejected because “it did not satisfy the assessment criteria, including criteria relating to the robustness of its proposed implementation plan.”

Another homegrown player, oBike, said that its exit from its home market earlier this year was due to the prohibitive costs of complying with the LTA’s new licensing regime. However, subsequent developments suggest that the company’s financial health may have been a bigger problem.

Ofo has reportedly faced its own cashflow issues, leading to retrenchment or total exits in several of the countries where it had launched services. It appears to have made a commitment to Singapore, despite the limitations placed on it by the LTA license.

Rachel Wong, regional public relations manager at Ofo, told Tech in Asia that the company has identified Singapore and Hong Kong as its priority markets in Asia, following a global restructuring effort earlier this year.

She added, “This renewed focus will allow us to provide better services as an effective short-distance mobility solution to our customers in these markets. Ofo continues to remain committed to provide dock-free shared bike services in Singapore, and we are fully aligned with Singapore’s car-lite vision to have bike sharing as a key component of Singapore’s next transport masterplan.”

Update, 11:21 am October 2: Added details from LTA on license applications.