RURA to regulate taxi moto fares as quest for cashless Rwanda continues
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Are you a regular taxi moto user? Well, you could soon start paying fixed fares for any given routes following plans by Rwanda Utilities Regulatory Authority (RURA) to start regulating taxi moto charges.
According to Patrick Nyirishema, the transport sector regulator, the move is geared at further streamlining the business and make it more attractive to investors.
Nyirishema believes that the move will benefit both passengers and the cyclists or investors in the taxi moto sub-sector.
The announcement came on the heels of the launch of an e-payment facility for taxi motos by MTN Rwanda and Yego Moto Company last week. RURA already fixes fares for public commuter buses, both for up-country and city routes.
While speaking during the official launch of tap&pay facility for commercial motorcycles in Kigali, Nyirishema reiterated the need for sector players to embrace innovation, saying this was paramount to Rwanda’s goal of becoming a cashless economy.
“It is because of the value we attach to taxi moto business that, as the regulator, we are supporting use of tap&pay e-payment solution,” Nyirishema said.
Though he did not say when RURA will start regulating taxi moto prices, he noted that new regulation will make it mandatory for all taxi motos to embrace the technology.
He projects that all operators in City of Kigali would have adopted the digital payment system by June of this year. The regulator, however, said the fares would be based on actuarial studies that have already been conducted, noting that they will ensure a win-win situation for everyone involved.
The innovation by Yego Moto allows taxi moto operators to charge passengers according to distance covered, which RURA says will be easy for them to fix prices based a new system.
The use of e-payment system has enabled public bus operators to cut costs, promote road safety and boost public transporters’ revenues, according to experts.
Nyirishema is optimistic that taxi moto business players could benefit from the same by embracing e-payment solutions.
The Yego Moto metered service uses the Global Positioning System (GPS) device installed on bikes to deliver information about the distance covered by a passenger.
Last year, both MTN Rwanda and Yego Moto Company inked a deal where taxi moto customers can pay their transport fares using mobile money service.
The deal, according to Aranvir Singh, the chief executive and managing director Yego Moto, means that MTN Mobile Money subscribers will only need to deposit money on their mobile wallets and use the telecom firm’s tap&pay platform to settle their taxi moto fares.
The firm said then that the move was aimed at making it more convenient for passengers to pay their fares using mobile money platform tap&go and also support drive to cashless economy.”
Launched last year, the MTN tap&pay system allows the telecom firm’s mobile money subscribers to make transactions using their mobile phones, said Norman Munyampundu, the MTN Rwanda chief business officer. The partnership comes at a time when the government is encouraging Rwandans to embrace electronic payment platforms and facilities for their efficiency and safety.
Research shows that digital financial services spur economic growth by widening the tax base and creating more jobs.
Riders speak out
Motorcyclists have welcomed RURA’s plan to fix prices, saying it will help make the sector more competitive, efficient and transparent.
Veatauri Tubanambazi, the president of Muhima Cooperative of Motorcyclists in Nyarugenge District, said that it is crucial as it eliminates guessing, meaning that passengers will only pay for distance covered.
It also avoids time wasting especially as there is room for bargaining or passengers fighting over prices.
According to the Rwanda National Police, some 50 to 60 complaints arising from the misunderstandings between passengers and commercial motorcyclists are recorded daily.
Data from Yego Moto indicates there are about 15,000 taxi motos operating in Kigali, making about 350,000 trips per day and nearly a million trips in three days. This, they think, is a big market.
The total investment in the system, according to management, is $14 million (about Rwf11 billion) and they say they expect returns in four to five years.
The system is installed on bikes for free, and riders also get free helmets. They are also trained on customer service, management and other related skills.
What taxi moto users say
Iradukunda Josiane, a tomato vendor in Kimironko Market, said some motorcyclists often take advantage of passengers especially when you don’t have small bills.
Therefore, the e-payment system will help eliminate such vices and losses (on part of users).
Pascal Mugabe, a student, said regulating moto fares could attract more investors, arguing that it will be easy to calculate the profitability of the sector.
The drive towards a cashless Rwanda
Experts say a well-regulated ‘smart’ transport system is a key component of the Smart City initiative.
It is, therefore, important to have an automated fare collection system, where passengers are able to pay their bills digitally, said Patrick Buchana, the CEO of AC Group.
Buchana said such innovations will help reduce loses public transport businesses have been incurring due to fraud hence hindering their ability to provide proper service to passengers.