The taxi drivers have Square. They just choose not to use it to avoid the processing fee. Also, cash payers are more likely to round up for a tip.

Then again, the solution to this is not necessarily Uber, but a regulation forcing taxi drivers to provide credit card payment. As far as I remember, these systems allow a default "do you want to tip" option (but I see what you mean, people probably tend to tip more with cash than with credit cards).

Most cities in the US have that regulation. The drivers trivially circumvent that regulation by saying the machine is broken.