Not all hopes is lost for divers who depended on ride-hailing services to sustain a living. PHOTO | FILE
Where should drivers and passengers turn to after the ride-hailing business in Tanzania has been turned upside down? This is a question that has been compounded by the continuous attrition of service providers in the online taxi business.
With the departure and change of mode of operation by some service providers, scores of drivers and a multitude of passengers are left stranded with little or no knowledge of how to continue with their seamless virtual commute plans.In a span of less than a year, two players who dominated the market; Uber and Bolt either indefinitely suspended or changed their mode of operation in what is attributed to be an operational strategy that is a reaction to regulatory and policy changes.
Read: Bolt to switch to corporate clients in Tanzania
Back in April, US ride-hailing giant Uber suspended its services in Tanzania, saying government legislation that raised fares and cut its commission to 15 percent made it difficult for it to operate. Uber said it made the “difficult decision to pause certain operations” in the country.
In March this year, Land Transport Regulatory Authority (Latra) raised fares and cut commissions for the ride-hailing operators, much to the displeasure of the latter.
As both drivers and passengers were still adjusting to the vacuum left by Uber, another big player in the market, Bolt switched its operation strategy on August 17 by focusing only on corporate clients and card-based customers.
With this change, thousands of drivers and passengers majorly in the commercial capital, Dar es Salaam were left wondering how else they will be able to sustain a living (for the former) and make their way around the city (for the latter).
A quick survey by The Citizen found that there are a few ride-hailing services still at work in Tanzania, but little is known about them. With the diminishing number of service providers in this space, it is now time for these underdogs to fill in the big shoes, and provide a lifeline to those who depended on this mode of business.
One of the fast-rising ride-hailing services is Paisha. A Vodacom Tanzania product, this mobility service provider caters to passenger commute, parcel transportation, food and grocery delivery.
The outcry of drivers who’d seen their incomes take a nose dive with the recent disruptions might find solace using the services that are still in the market. Such is the case for Janet Ndung’u, a Dar es Salaam resident who had to switch to Paisha after being dissatisfied with similar services in the past, especially on the driver’s commission.
Janet owns three cars which she secured through loan. She drives one, and has hired two drivers for the rest. However, despite the positive experience from using Paisha, she says recent disruptions in the business have negatively impacted her operations.
Due to limited awareness of alternative service providers such as Paisha, Janet says she is facing difficulty getting clients. “At times I spend a whole day without getting a single request,” she says, and adds that some days she decides to just park her car. She has similarly parked her other two cars because the drivers would get very few requests, not enough to sustain business.
As a result, the entrepreneurial driver advises Paisha to advertise their business in order to attract potential passengers. “They need to do intensive marketing in order to make people aware of their existence,” she advises.
She also advises the service provider to help drivers switch to gas. “With the rising fuel prices, it will be prudent for us to switch from petrol and diesel to gas. Paisha should sponsor us on this,” she says.
Janet is a mother of 6 and a widow. She says she depends on the online taxi business to sustain a living for her family. She thus asks that services such as Paisha that have remained the only lifeline in an increasingly tough market to be given more prominence so that more people do start making requests.
For Japhary Omary, a Kimara resident in the city, the ride-hailing business has been a bag of mixed fortunes. He has used Bolt and Uber in the past, and with the prevailing circumstances he relies on Paisha for income. A professional driver, Omary says clients are there, and expects requests to increase with the limited number of players left in the market.
“What customers want are cheaper, accessible rides. Previously, the landscape was a bit complicated with stiff competition among players. But now the few service providers left in the market have created room for drivers to get more clients and make good money,” he says.
Like Janet, he advises the existing ride-hailing service providers to advertise more in order to create awareness that will lead to growth in service demand. Saying that the few perks that are given to drivers, including car and life insurance mean there is more reason for this business to thrive.
Another driver, Kiza Jumanne who has been using ride-hailing services like Uber, Bolt, and Paisha, says the business has certainly changed. However, he is hopeful for the future. “I started using Paisha the first time it entered the market with a soft launch back in 2021,” he says. And over the last couple of months he has experienced his fair share of ups and downs. “I used to earn up to Sh80,000 a day during the peak season of ride-hailing services,” he reveals. But that income has since decreased to levels he says are making it difficult for him to survive, but he still maintains that the future looks bright.
“I think services like Paisha have great potential. However, they need more advertising in order to attract more users,” he says.
On-demand services like ride-hailing are gaining an impetus in Tanzania due to the digital growth experienced across multiple sectors.
According to Goodluck Moshi, Head of Department (Innovation and Care) at Vodacom Tanzania, there is a lot of value that is being channeled to the rides and deliveries ecosystem aimed at profiting drivers. “When we entered the market we started charging 15 percent commission instead of 30 percent. This is because revenue wasn’t our primary focus, but creating a properly balanced model,” says Moshi.
With many drivers now looking for ways to forge ahead after the exit of Uber and Bolt’s change of model, different apps have seen an increase in registration, with some like Paisha registering over 1,000 new daily entries of late, with the overall number of drivers on the service standing at 8,000, serving customers across the country.
“We plan to make the platform more inclusive by providing access to those using feature phones as well,” says Moshi. The head of innovation adds that over 50 services can be offered on the platform, however, they’ve now started with transport and logistics, and will expand to cater to the growing e-commerce sector in the country.
But apart from Paisha, another available ride-hailing app is Little Ride – a pan-African platform providing passenger commute. In Tanzania, the business is currently big in the corporate sector, with many businesses already using it to get around the city.
Also in operation is Ping, a ride-hailing service providing transport solutions.
All these platforms are available through online applications downloads on mobile phones and other digital devices.
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