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CORRECTED-UPDATE 1-Australia's Cabcharge pins hopes on payment app amid Uber competition

Published 21/08/2015, 12:40 pm
© Reuters.  CORRECTED-UPDATE 1-Australia's Cabcharge pins hopes on payment app amid Uber competition
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(Corrects name of managing director to Andrew in paragraph 4)

* Cabcharge FY profit falls 16.6 pct, revenue down 4.7 pct

* Company wants new payment app rolled out in current half-year

* Regulators still assessing international booking app

* Uber fares rising following GST ruling

By Jane Wardell

SYDNEY, Aug 21 (Reuters) - Taxi services firm Cabcharge Australia Ltd CAB.AX has hired software developers to rush a payment app to the market as its fights against the soaring popularity of ride-sharing service Uber Technologies Inc UBER.UL .

Cabcharge, which provides the electronic payments system for 97 percent of Australia's taxis, is one of scores of traditional taxi businesses around the world threatened by the rise of Uber.

On Friday, it reported a 16.6 percent fall in annual statutory net profit to A$46.8 million ($34.2 million), its second consecutive year of decline, after state governments exacerbated its troubles by curbing the fees it can charge passengers.

Managing Director Andrew Skelton said Cabcharge was using savings from cost cuts to build the payment app, which would offer similar services to Uber.

"We can't wait much longer," Skelton said as the company reported its earnings. "We know it's important to get payments in apps to market in the current half."

Uber has picked up hundreds of thousands of customers since it launched in Australia two years ago, although it faces legal challenges to its status: it is technically an illegal service in almost all states and territories, but state governments are loathe to shut down a widely used service.

Uber is also challenging a ruling by the Australian Tax Office that its drivers must pay goods and services tax.

In the past year, Cabcharge's share price has dropped 36 percent, underperforming a broader 6 percent fall in the market .AXJO as Uber's popularity increased.

In a bid to boost revenue, Cabcharge clubbed together with U.S.-based Taxi Services Inc to launch an international booking app called iHail that could be used in Australia, the United States and Britain, but Australian regulators last month declined to fast-track its approval.

($1 = 1.3648 Australian dollars) (Editing by Paul Tait and Miral Fahmy)

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