Cash-strapped London boroughs are increasing fee demands and enforcement charges on e-bike operators, prompting accusations from industry leaders that councils are treating the sector as a cash cow.

According to figures seen by City AM, one London borough more than quintupled annual operating fees in a single year without adding any additional parking bays. Across the capital, operators say charges have risen by as much as 15,100 per cent since 2022, while investment in parking infrastructure has not kept pace.

The complaints come as Transport for London (TfL) prepares to take over regulation of London’s fragmented dockless bike market through a single licensing scheme, replacing the current borough-by-borough patchwork of agreements. The change is being watched closely by operators, councils and riders alike because it could determine how consistently the city’s e-bike network is managed, where bikes can be parked and how much firms must pay to access different parts of London.

Operators say the existing model is becoming financially unsustainable. They argue councils are demanding annual licence fees, revenue-sharing arrangements, low promotional fares and enforcement charges while failing to invest enough in parking infrastructure to cut pavement clutter. That combination matters for the wider market because dockless schemes depend on a balance between access, parking and enforcement: if charges rise faster than the infrastructure needed to support them, services become harder to scale even in areas with strong demand.

London Councils rejected the claim that boroughs are using e-bike schemes primarily to raise money.

Councillor Paul Osborn, London Councils’ executive member for transport and environment, said operators should “contribute appropriately to managing their impact on public space”. He said revenue from operator fees and enforcement action helps boroughs manage e-bike schemes, including funding dedicated parking bays and council officers working to keep streets “clear and safe for residents”. Boroughs receive no additional funding from central government for the work, he added.

Osborn said London Councils was working towards a more consistent approach across the capital, but added: “Any move towards increased standardisation should balance consistency with room for boroughs to address those needs locally.”

A person familiar with the sector warned that rising costs could lead to a “Zipcar-style” outcome, with operators eventually forced to withdraw from parts of London.

Figures seen by City AM show one borough increased annual operator fees by 403.6 per cent between 2024 and 2026 while expanding parking bays by just 46 per cent. Another raised fees by 277.2 per cent while increasing parking infrastructure by only 6.3 per cent, and a third increased charges by 166.7 per cent.

City AM understands that another operator faced permit and compliance costs of more than £80,000 before deploying a single bike in the City of London, alongside enforcement fines of around £10,000 a month for each issue area.

Operators say the burden is worsened by tender terms that can include discounted £1 fares, annual licence fees, a share of ride revenue and penalties for impounded bikes.

People familiar with the matter also questioned how some borough tenders are assessed, saying councils can award contracts based largely on the percentage of revenue offered without requiring bidders to show how much revenue they are likely to generate.

“A smaller revenue share from a busier operator could be worth considerably more than a larger share from one with fewer rides,” a person close to the matter told City AM.

The concerns follow comments by Kensington and Chelsea council leader Elizabeth Campbell, who told the Conservative Party conference that the authority had opened “a new revenue stream” by seizing badly parked rental bikes.

“We impound them and Lime have to pay us. We’ve fined Lime £50,000 over the last two weeks which is pretty good,” Campbell said, according to London Centric.

Calls for greater transparency

Operators say the current system rewards councils for raising prices rather than expanding parking capacity.

Some borough contracts require companies to pay annual licence fees, hand over a share of ride revenue, fund discounted fares and cover the cost of impounded bikes.

City AM understands that operators also question procurement processes that place more weight on the percentage of revenue offered to councils than on projected ridership.

Christina Moe Gjerde, vice-president of Northern Europe at Voi, said rising costs were making it harder for operators to invest despite strong demand.

“The opportunity is big and operators want to invest millions in a market they see huge potential,” she told City AM. “However, increased costs and rules that vary from borough to borough make it increasingly hard to deliver the investment we want to make.”

She added that councils should be clearer about how operator fees are spent.

“Where boroughs are charging significant fees, there should be greater transparency around how that money is used,” she said, adding that revenue should be reinvested into parking infrastructure and scheme management.

Kensington and Chelsea said its e-bike enforcement programme operates on a cost-neutral basis and generated £135,614.80 from recovery and storage charges during 2025. The borough also cited storage costs, officer deployment and administration as reasons for the charges.

It added that it supports a London-wide licensing scheme in principle, subject to further detail on funding and enforcement.

TfL takeover

London is currently the only major city where dockless bikes are regulated individually by boroughs rather than under a single city-wide framework.

The government is preparing legislation that would allow TfL to replace the current system with a single licensing regime across the capital.

“A consistent, London-wide regulatory framework is what allows operators to invest for the long term, rather than negotiating market access borough by borough,” a Bolt spokesperson told City AM.

“We’ve seen permit and compliance costs vary sharply between boroughs, and that unpredictability is what restricts investment, not the cost of operating well-used services.”

Alice Pleasant, senior public affairs manager at Lime UK and Ireland, said operators recognised that councils were under financial pressure, but warned the current system was making cycling less attractive.

“The most important consideration for councils when selecting a provider is whether they can deliver a high-quality service for residents that is affordable and accessible,” she said.

“Our concern is that a fragmented, borough-by-borough model with different agreements, operators and rules risks making cycling less convenient and, ultimately, less attractive for Londoners.”

Pleasant pointed to Richmond, where riders crossing the borough boundary can be forced to switch bikes and apps, highlighting how differing council rules create friction across the capital.

Ealing Council said it supports legislation allowing the transport body to oversee a single rental e-bike contract. A spokesperson told City AM: “It will simplify the current system and help ensure residents receive a more consistent service across London.”

TfL also backed the reforms, saying legislation would allow it to replace the current “patchwork” approach with a London-wide licensing scheme.

“This would provide the future ability to replace the existing patchwork and borough-by-borough approach with a consistent licensing scheme for London,” a TfL spokesperson said.

City AM understands the Department for Transport is expected to bring the necessary powers into force within the next 12 to 18 months.