BUSINESSNews

Bolt considering suspending operations in Tanzania after 15% fee service order


Popular ride-hailing company, Bolt could be forced to shut down its services in Tanzania following a controversial 15% fee service order that took effect on Friday, 13 April.

The Estonian company is disputing the fee introduced by Land Transport Regulatory Authority (Latra), an entity created in 2020 to regulate the taxi sector.

Bolt East Africa regional manager, Kenneth Micah  said, “Bolt has requested a meeting with the relevant stakeholders to further discuss this particular matter with the hope of reaching favourable tariff and commission regulations, even as we continue to seek and explore alternative lobbying options provided within the legal framework including Latra regulatory framework.”

Bolt and Uber have dominated African and European markets and operate in aggressive competition with each other.

Last week, Uber which charges its partners a 25% commission, suspended its operations in Tanzania over the newly introduced service fee, terming it as unfavourable for business. The company said it would resume operations if its concerns were addressed.

Latra reviewed the ride-hailing rates last month and ordered the affected operators to comply. The new directives require ride-hailing companies to reduce “dead kilometres”- the distance drivers are expected to cover to pick up a passenger. The regulator also wants companies to provide an arbitration platform where drivers can raise their voices and be heard when passengers lodge complaints.

“Should Latra maintain the status quo, the market will eventually cease to be viable for Bolt, and this will necessitate turning off our car category,” Micah said. “We are complying temporarily to demonstrate goodwill and our commitment to engage with Latra for more favourable regulations that enable further investment.”

Bolt has operations in seven African markets including Kenya, South Africa, Uganda and Ghana. If it suspends its services, over 10,000 driver-partners will have to seek alternative means of earning a living.

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Simon W Nderitu

Simon is a tech enthusiast who keeps a close eye on emerging technologies, startups and the general business environment. You will often catch him totally immersed and drooling over Artificial Intelligence, Machine Learning, Virtual Reality, Augmented Reality, IoT and just about any other tech that promises to revolutionize the way we live. Send tips to snderitu@techtrendske.co.ke

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