The taxi booking industry has witnessed a lot of problems when it comes to safety concerns. The security of a passenger traveling in a taxi is of utmost importance and it demands continuous monitoring. The most advanced location-based technologies let the taxi business authorities to track their fleets constantly. Geofencing in taxi booking app development uses location data to track their cabs and showcase relevant notifications to their passengers.

What is Geofencing?

With the advancements in technology, almost every industry has integrated mobile solutions in their businesses in order to improve user experience. Smartphones are helping us with a great significance as an interactive technology medium in every routined activity. Apart from its other vital features, mobile apps come up with location-based services which have turned out to be an important resource for the companies to stand out from the competitors. It is one such prominent technology that helps users set the virtual geographical boundaries on the integrated maps. It also allows businesses to track their customer locations with the use of a GPS platform. This is a technology that sets virtual parameters on an actual geographic location. It is a location-based service that puts a virtual fence around the predefined region.

Geofencing integrated apps use RFID, GPS systems, or data networks to perform a pre-described action when a registered mobile device is located in that region. With its utilization, companies can set virtual borders around the actual locations and trigger immediate notifications if a user breaches into that virtually-fenced area. Those virtual borders can be around the stores, public transportation stations, shopping malls, restaurants or any other crowded place in the town.

There are two types of geofence virtual perimeters:

  • Active Geofencing

    Active geofencing uses location-based services like GPS and RFID systems to track the user’s location.

  • Passive Geofencing

    Passive geofencing basically works on network connections. It either uses cellular connectivity or Wi-Fi connectivity. It runs in the background when the phone’s Location setting is on.

Importance of Geofencing in Taxi Booking Industry

The taxi industry is already enriched with a variety of features and functionalities. Yet, this advanced technology is setting new standards when it comes to security concerns. It has effectively increased productivity and improved user experience. It utilizes GPS to set a virtual perimeter around a specific geographical area to provide location-based services. It helps taxi businesses attract passengers by notifying them with the latest discounts and promotions. It also helps them update or add new fares for that area. Geofencing in taxi booking offers following functionalities-

  • Define virtual zones around a specific region.
  • Define fixed fare for the geofenced zones.
  • Get notified when the driver breaches the defined zone.
  • Notifying the users with the latest offers and discounts.
  • Making changes in routes and vehicles for particular regions.

How Geofencing Works in Taxi Booking Softwares?

Geofencing technology results in improving fleet utilization and developing a better demand-supply ratio of customers and fleets. It also facilitates businesses to take instant overall decisions with respect to the benefit of the organizations. The basic geofencing operation needs location-based services to track a user’s device within a specified area. To create the virtual fence, the admin person can simply mark the operational area by connecting the dots on online maps. Once the specified area is marked, only the users and drivers inside that region can request and accept the ride respectively. The integration of Google Maps and Google Earth helps the admin define the perimeters in a satellite view of pre-described geolocation.

Let’s have a look at how you can set geofencing:

Step 1 - Login to your map page and select a device. Click the "Geo-Fence".
Step 2 - Defining following parameters.
  • Center point.
  • Length.
  • Notification.
  • Email address.
Step 3 - Press the save button.
Step 4 - Using geofence page, you can edit the marked areas.

A Guide to Google Maps API Integration for Your Taxi-hailing App

Applications of Geofencing

Applications of Geofencing

With the technological transformations in mobile app development, it has become a regular practice for many enterprises. Once a virtual fence is defined, the opportunities that the companies have are endless to reach out to their target audiences. Let’s see its applications of the taxi industry:

1 Taxi Management

With the use of geofencing in taxi booking software, business owners can track their vehicles. Basically, GPS trackers fitted in each vehicle immediately notifies admin personnel whenever a taxi leaves the geofenced area. This way they can keep a track of their driver movements and provide safe and secure services to their passengers. It also helps them identify the unethical use of their fleet and saves fuel.

2 Public Security

In the public spaces, traffic and police authorities can track a suspected object or person whenever enters or leaves a geofenced area. This helps them investigate and handle situations at the right time.

3 Event Management

Geofence can be used prominently by event management companies for the marketing of their services. They can set a virtual parameter around the beauty shops, resorts, restaurants, wedding halls, and notify the person entering that geofenced area with service advertisements.

4 Traffic Restriction

Metro cities often witness huge traffic jams. It usually happens if the unpermitted vehicle enters into the restricted region. To prevent this, this technology can be used to notify the vehicle drivers not to enter into that specified area. It can also help the drivers skip the crowded routes by directing them to alternative routes.

Challenges of Geofencing

  • Privacy Concerns:

    In order to avail its benefits customers have to submit their basic private information like contact numbers, mail id, addresses, etc. This increases the theft chances of that private data submitted by the customer. This sensitive data can get hacked and misused for other purposes which eventually results in deteriorating customer experience.

  • Relevant Messages:

    This is one of the major problems faced by geofencing, in case the retailer or any business owners does not get the categorized user data, they might end up sending the marketing notifications to the irrelevant customers. Any customer who is not relevant to that service gets notified whenever he/she enters into that predefined region which makes it pointless. This costs businesses with a waste of resources and time.

  • Higher Costs:

    Implementation of Geofencing is a big challenge for businesses, specifically for the small ones or startups, as it’s solutions are very expensive.

  • Management:

    Once it is implemented it needs constant management. The maintenance and management of tracking devices is a very tedious process.

Benefits of Geofencing in Taxi Industry

i Personalized Customer Engagement

Geofencing in taxi management allows businesses to categorize the users according to the relevancy. For example, it lets you send the notifications of airport taxi discounts to the people that are relevant or inside the airport region. This way you can send personalized notifications to the users to attract them to your services.

ii Saving Money

Geofencing in taxi app development helps businesses make a proper use of the resources for the promotion and marketing campaigns. When taxi companies opt for various business marketing strategies, there are high chances that their notifications reach irrelevant customers. Using this technology businesses can overcome these situations as they can send marketing alerts to the categorized people looking for taxi-hailing services.

iii Rich Data Collection

On-demand taxi companies preferably rely on categorized user data. This data helps them customize their services in order to improve customer experience.

iv All-Time Accessibility

Various mobile marketing tactics depend on multiple locations-based services. As location-based services rely on network connectivity, it runs all the time on the user's smartphones in the background even if the customers are not using their devices.

v Plug & Play Integration

It allows easy integration of the plot projects to run the marketing and promotion campaigns. Taxi companies can use most advanced targeting plugin for their taxi apps, which helps them send the location based notifications to the users.

vi Meeting Customer Demands

For the business of any sector, their main objective is to fulfill customer demands. Businesses can geofence the region having high demands to understand customer behavior and boost their business outcomes.

Geofencing Features for Taxi Booking Apps

Features of Geofencing-enabled taxi app

The geofencing integrated apps comprise a wide range of functionalities. Right from creating the marketing tactics to getting notified in case of any emergencies, business owners rely completely on these solutions. Here are some geofencing features in the taxi apps

  • Send Notifications:

    Send push notifications based on the places of interest within geofenced boundaries – from the entire city to the particular store. Taxi businesses get alerts whenever their taxi exits the geofenced area.

  • Location Tracking:

    Using location-based services, taxi companies can receive the data of the time period the user was present in that geofenced area. It also records the frequency with which the user visits that region. Generated logs help the admin person analyze the insights and make better business decisions.

  • Monitoring Assets:

    In transportation, it can be used to track company assets as well as check the frequency of a particular resource.

  • Fare Fixation:

    Geofencing in taxi app solution helps companies set varying prices for different regions. The main example is surge pricing. They can set the higher costs in the regions where the ride-hailing or courier demands are higher. They can set fare charges based on three criteria - city-based fare for geofence set around a particular city, zone-based fare if the virtual border is set around a particular zone, and zone to zone fare if the customer is getting served from one geofenced zone to another.

  • Behavior-based Tokens:

    Taxi companies get records of customer behavior, which includes the frequency of passenger traveling, taxi-hailing choices ranging from ridesharing to the premium taxis, etc.


Undoubtedly, geofencing is the future of the taxi-hailing sector. Development or integration of geofencing promises numerous benefits to the taxi business. With the use of geofencing and its location-based service, companies can create location-specific marketing tactics to improve customer engagement and receive returns from promotional campaigns. Businesses often use it to run hyperlocal marketing strategies, giving them the best way to reach up to the expectations of the targeted audience. Implementing geofencing in their business, taxi companies can constantly track their fleets and take immediate action in critical situations, which would eventually help them improve service reliability and user experience.

Streamline Operations With A Mobile-first Geofencing Technology

Author's Bio

Nitin Lahoti Mobisoft Infotech

Nitin Lahoti

Nitin Lahoti is the domain expert of Logistics and Transportation. He has 12+ years of experience in Design, Business Development and Startups. His expertise is in Product Ideation, UX/UI design, Startup consulting and mentoring. He prefers business readings and loves traveling.