Who should drivers and passengers turn to after ride-sharing business in Tanzania has been disrupted? This is an issue that has been compounded by the continued attrition of service providers in the online taxi business. With the departure and change of mode of operation of some service providers, dozens of drivers and multitudes of passengers find themselves stranded with little or no knowledge of how to continue their flawless virtual ride plans.
In less than a year, two players who have dominated the market; Uber and Bolt have indefinitely suspended or changed their mode of operation in what is attributed to an operational strategy that is a reaction to regulatory and policy changes.
Read: Bolt to move to corporate clients in Tanzania
Last April, US ride-sharing giant Uber suspended services in Tanzania, saying government legislation that raised fares and cut its commission to 15% was making it difficult to operate. Uber said it made the “difficult decision to suspend certain operations” in the country.
In March this year, the Land Transport Regulatory Authority (Latra) increased fares and reduced commissions for ride-sharing operators, much to the chagrin of the latter.
While drivers and passengers were still adjusting to the void left by Uber, another big player in the market, Bolt changed its operating strategy on Aug. 17 to focus solely on corporate customers and card customers.
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With this change, thousands of drivers and passengers, mostly in the commercial capital, Dar es Salaam, wondered how else they could earn a living (for the former) and get around the city (for the latter).
A quick survey by The Citizen revealed that there are still a few carpooling services in Tanzania, but little is known about them. With the number of service providers in this space dwindling, now is the time for these outsiders to fill the big shoes and provide a lifeline to those who depended on this mode of business.
One of the booming carpooling services is Paisha. A product of Vodacom Tanzania, this mobility service provider caters to passenger travel, parcel transport, food and grocery delivery.
The outcry from drivers who have seen their income plummet with the recent disruptions could find solace in using the services that are still on the market. Such is the case of Janet Ndung’u, a resident of Dar es Salaam 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 that she secured with a loan. She drives one and has hired two drivers for the rest. However, despite the positive experience of using Paisha, she says recent business disruptions have negatively impacted her operations.
Due to limited knowledge of alternative service providers such as Paisha, Janet says she struggles to find clients. “Sometimes I go a whole day without getting a single request,” she says, and adds that some days she decides to just park her car. She also parked her two other cars because the drivers were getting very few requests, not enough to sustain business.
As a result, the entrepreneur driver advises Paisha to advertise his business to attract potential passengers. “They have 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 gasoline. “With 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 children and a widow. She says she depends on the online taxi business to support her family. She asks that services such as Paisha, which have remained the only lifeline in an increasingly difficult market, be promoted more so that more people start making requests.
For Japhary Omary, a resident of Kimara in the city, the ride-sharing business has been a bag of mixed fortunes. He has used Bolt and Uber in the past, and with the current circumstances he relies on Paisha for his income. A professional driver, Omary says the customers are there and expects demands to increase with the limited number of players remaining in the market.
“What customers want are cheaper and accessible journeys. Previously, the landscape was a bit complicated with tough competition between players. But now the few remaining service providers in the market have created space for drivers to have more customers and earn a lot of money,” he says.
Like Janet, he advises existing ride-sharing service providers to advertise more to create awareness that will lead to growth in demand for the service. To say that the few perks given to drivers, including car insurance and life insurance, means there are more reasons for this business to thrive.
Another driver, Kiza Jumanne, who uses ride-sharing 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 hit the market with a soft launch in 2021,” he says. And over the past two months, he’s had his fair share of ups and downs. “I used to earn up to 80,000 shillings a day during the peak season for carpooling services,” he reveals. But that income has since declined to levels that he says make 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 to attract more users,” he says.
On-demand services like ride-sharing are gaining momentum in Tanzania due to the digital growth recorded in several sectors.
According to Goodluck Moshi, Head of Department (Innovation and Care) at Vodacom Tanzania, there is a lot of value being funneled into the ride and delivery ecosystem aimed at benefiting drivers. “When we entered the market, we started charging 15% commission instead of 30%. This is because revenue was not our primary focus, but creating a properly balanced model,” Moshi explains.
While many drivers are now looking for ways to move forward after the release of Uber and Bolt’s model change, different apps have seen an increase in registrations, with some like Paisha seeing over 1,000 new daily entries. lately, with the total number of drivers on the service rising to 8,000, serving customers across the country.
“We plan to make the platform more inclusive by also providing access to those who use feature phones,” says Moshi. The innovation manager adds that more than 50 services can be offered on the platform, but they have 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 carpooling app available is Little Ride – a pan-African platform for passengers to ride. In Tanzania, there is currently a lot of activity in the business sector, with many companies already using it to get around the city.
Ping is also in operation, a carpooling service offering transport solutions.
All of these platforms are available through online app downloads on mobile phones and other digital devices.