Mobike does away with deposits in China

Meituan-owned bike rental firm Mobike has removed deposits for all users in China in an effort to standardize its deposit system.

In May, the company began trialing deposit-free rides in Hefei, Hangzhou, Dongguan, and other cities.  The trial area was then extended to one hundred areas around the country, including second and third-tier cities. However, a number of first-tier cities were excluded from the trial.

Deposit-free rides will now be standard across the country. Existing users can apply to have their deposits refunded. According to a Mobike representative, if a warning appears in the app when you try to use the platform after being refunded, you will need to update the app. If it is up to date, the server is giving an old message, and it will work nonetheless.

The move could make the company more competitive in the battle for market share against its main rival ofo.

Deposit systems within bike rental applications have been a contentious issue over the past few years. Before being taken over by Didi, Bluegogo’s vice-CEO Hu Yufei admitted that the deposits had formed part of the company’s operating budget. Additionally, Coolqi also ignited fears shortly before going under. The company said it would no longer refund deposits through WeChat, and required users to visit an office in Chengdu, Sichuan to get their money back, causing the government to step in.

Mobike has also announced bike rental integration into the Meituan platform, a new fleet of e-bikes to extend transportation range for its users, and a program to recycle components from retired bicycles.

The waste created by out of service bicycles has been a cause for concern in recent months. Thousands of retired bicycles can be seen on the outskirts of cities. It was also revealed that bikes had been deliberately damaged in some cases. In May, a bicycle graveyard was found in Chengdu containing hundreds of broken ofo bikes.