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December 19, 2018

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Wheels fall off at ofo as 9 million struggle to get bike deposits back

MORE than 9 million people are battling to get their deposits refunded from struggling shared bike service ofo.

A screenshot posted by a Weibo user identified as Lao Xu yesterday afternoon showed 9.01 million users queued in the online refund system.

Ofo said in its official microblog that it will handle the refunds according to the time they were requested.

The company has repeatedly denied reports it is in financial difficulty but declined to comment further.

It had started to demand a 199 yuan (US$28) deposit from users ­鈥 previously this was waived.

Most public bike sharing firms waive deposits.

There are suspicions that the cash-strapped company has been delaying refunds to pay creditors.

Hundreds of users have been queuing up outside ofo鈥檚 headquarters in Beijing鈥檚 Zhongguancun area after China Youth Daily reported on Sunday that a user had managed to retrieve her deposit at ofo鈥檚 headquarters after unsuccessful attempts online.

A Shanghai rider surnamed Zhou said she has been trying to reach the company through its customer hotline since last week.

She put forward her refund request first through ofo鈥檚 smartphone application but didn鈥檛 get the refund within the promised 15 working day span.

鈥淚 don鈥檛 think I will ride ofo bikes again even if it provides me a refund, because its service seems extremely unreliable,鈥 she added.

Ofo and its Shanghai-headquartered rival Mobike are the country鈥檚 two leading bike-sharing companies.

There have been reports of ofo encountering capital pressure following鈥檚 Meituan Dianping鈥檚 acquisition of Mobike in April this year.

International Financial News reported earlier this week that at least 18 companies, including logistics suppliers and manufacturers, are taking legal action against the bike rental company. Shanghai Phoenix Bicycles is said to be seeking as much as 68 million yuan from ofo.

There were dozens of bike sharing companies at the peak of the market in 2016. But enthusiasm quickly faded as users found many of the bikes were faulty, and investors struggled to see how the companies could turn a profit.


 

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