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Digital Taxi platforms forced to lower commission paid by drivers to 18%

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The Kenyan Government has published new rules for the digital taxi platforms that will see the services lower the commission they require from drivers to 18%. These rules have been published by Transport and Infrastructure Cabinet Secretary James Macharia.

The new law states, “The commission which shall be paid by a transport network driver or a transport network owner to the transport network company, which shall not exceed eighteen per cent of the total earnings of the trip.”

“Transport network platform” means a digital platform or any other similar system offered, used or operated by a transport network company and used by persons for the transportation of passengers for compensation by a transport network driver,” the new law stated.

Varying rates

At the moment, the different platforms have different commission requirements with Little having the lowest at 15% of the ride value.  Bolt and Uber take 20% and 25% respectively. These seem high and this has always been an issue with most drivers.

Little seems to be the only platform that will not be affected with the new laws as the commission they take is lower than the maximum set by the government. Bolt previously had its commission rate set at 15% but increased the rate to 20% back in 2019. 

With the rise in the price of petrol, the digital taxi platforms have been slow to adjust their prices upwards. Uber just recently said that it plans to adjust its prices to cushion its drivers from the rising costs of doing business. This will be the second price adjustment by the company this year. 

Companies to seek new licenses

With the new rules, these digital taxi platforms will be forced to also seek new licences and provide details such as as revenue sharing pacts, registration by the Data Commissioner, pricing mechanism between them and subscribers as well as contractors with vehicle owners, among others according to the Nation. 

“Each transport network company and transport network vehicle that was in operation before the commencement of these Regulations shall continue to operate for a period of ninety days within [within] which they shall be required to acquire the necessary licenses (sic) provided for under these Regulations,” the new regulations read.

Read: Bolt Opens its African Hub in Nairobi

About author

Editor at TechArena. I cover all things technology and review new gadgets as I get them. You can reach me on email: kaluka@techarena.co.ke
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