Ofo, plagued by bankruptcy rumors, has had a tough year trying to pay back user deposits. The Chinese bike-sharing startup, who still owes more than 15 million user deposits, recently launched a new controversial refund policy.
Last December, hundreds of ofo users queued up outside its Beijing headquarters to ask for their deposits back. Nearly 12 million of the company’s registered users had requested deposit refunds, an amount reaching nearly $170 million.
Now, ofo has launched a new campaign“Cash Back Daily” in which users have to spend money in order to get their deposit back.
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Using the “Cash Back Daily” interface, users can shop, and get a small amount back for each product purchased. For example, by buying milk worth 56 yuan, users get 1 yuan back, and by purchasing a 55 yuan container of laundry detergent, users will get 2.88 yuan of their deposit back. In other words, users need to purchase at least $210 worth of products in order to “get back” their $14 deposits.
Interestingly, once the user authorizes and agrees to participate in the campaign, the deposit will be transferred to the “Cash Back Daily” account balance, and can no longer be refunded by any other means than shopping.
At present, the company on average pays back 3,500 yuan worth of deposits daily. There are currently more than 15 million users waiting in line to have their deposit refunded which, at the current rate, would take ofo about 11.7 years to accomplish.