UPDATE: It’s all happening now – see here for the latest news.

It’s on hold, for now…

We got you all excited earlier this month with the announcement of UDrive, an app that offers you pay-per-minute rental cars dotted all around the city.

It did all seem a bit too good to be true. Find, book and unlock a car nearby using an app on your phone, drive it around at a rate of just 50 fils per minute, with free petrol, free parking and a price cap of Dhs120 to rent the car for the whole day.

Unfortunately though, UDrive’s 50 fils a minute pay scheme has been suspended due to regulatory issues.

*More: Hands-free calls while driving may soon be banned in the UAE*

In a statement released by the company, UDrive said: “We would like to inform you that at the time being, UDrive can offer car-rental service on a daily basis only, the previously offered service per-minute car rental scheme is currently put on hold until certain logistical, regulatory, and administrative issues are resolved.

“We are sorry for any inconvenience this might have caused. For customers who have registered with us, we will be refunding your membership fees should you wish.”

*More: Soon, half of Dubai’s taxis will be hybrid cars*

While they may no longer be able to run their pay-per-minute plan (for now), UDrive have tried to soften the blow to their customers by reducing the daily rental rate on their cars from Dhs120 to Dhs99.

UDrive have said on their website that they’re working closely with the Roads and Transport Authority, searching for a solution which is in line with the emirate’s rules and regulations with regards to car rentals. This gives us some hope that their initial pay-per-minute ways may return.

*More: Driving on the phone may soon lead to your car being confiscated*

The UDrive fleet, which currently consists of 50 Toyota Yaris models, was set to expand to 200 within the weeks after their launch. However with the sudden restrictions to their payment methods, it’s hard to say whether they’ll go ahead with their plans for rapid expansion.