 "It's a first, Uber lets customers pay by cash in Hyderabad")
The service is being launched as an experiment in Hyderabad to gain a deeper understanding of consumer behavior and usage trends to help develop more robust payment options for the local market, Uber said.
The company accept payments using credit cards globally. In India, customers can pay for rides using Paytm's mobile wallet as well.
"This is an experiment and a global first for Uber across our 300-plus cities. We have worked hard to create a seamless cash payment option that is truly Uber," it said.
Hyderabad was selected because it provided Uber with the "right environment to test a new payment option amongst a sizeable and sophisticated rider and driver community", it added.
Users would need to choose the 'Cash' option, take a ride and pay the driver directly in cash at the end of the trip. However, users will not be able to make part payments on cash trips with their Paytm wallet.
There would be no booking fee or additional charge to riders.
The cash option will be rolled out gradually over the next few days, the company said.
Over the last few months, Uber has introduced a number of features like SOS and send status features for customers in India.
India has about 20 million credit cards for a population of 1.3 billion. Though the government is trying to change this, most purchases are done with cash.
ALSO READ: Uber's value to hit $50 bn after fundraising
Last month, Uber had launched an aggregator service to help commuters book auto rickshaws for traveling in Delhi, where customers could pay the fare in cash for the service.
"Tradition dictates that cash plays a big role for Indian consumers. As a data-driven technology company that has seen strong growth in India we feel this is the right time to explore the extent of this predisposition when it comes to our service," Uber Hyderabad GM Siddharth Shanker said.
India, for Uber, is a hotbed for innovation globally and experiments such as this provide the firm deeper insight into the local market and helps innovate around the evolving needs of consumers, he added.