vooke, Explain to me the Benefits of Cashless Matatus

[Omollo]

• Tweet

What benefit is there for anybody? It does not help the manambas so you and me know we shall still pay cash on board. Son who benefits? The system is such that the owner wants a certain amount per day regardless... Then the driver and the mate eat any extras. The taxman is not in the deal. Now explain to me how manamba will collect money for KRA?

[vooke]

Initially I thought it was a security measure, where vehicles are jacked and all the fare is collected. But the amounts are quite small. A 60 seater bus charging 100 has 6K. This is too little an incentive for Okoyus. It is not even worth a Beretta's day lease. Of course after every trip they remit to the owner to minimize risk of loss. Okoyu thugz go for wallets and mobile phones. Security is not IT

I suspect the government wants to tax but if they introduced the taxes right away, nobody would adopt this technology. So the idea is to get the raia familiarized with the system and then sneak in a levy at some future date

What benefit is there for anybody? It does not help the manambas so you and me know we shall still pay cash on board. Son who benefits? The system is such that the owner wants a certain amount per day regardless... Then the driver and the mate eat any extras. The taxman is not in the deal. Now explain to me how manamba will collect money for KRA?

[RV Pundit]

My 2 cents. It part of attempt to formalize the matatu sector. Our transport sector is really informa. This cashles move is in line with requirement to join saccos and all the attempt from Michuki time (uniforms, salaries, painting yellow line) are geared towards making the sector formal..this will allow gov to tax it eventually..but the sector will also grow given for example..banks will start seeing the cashflows of matatus.

It is a good move. Manamba and Cops will sabotage it..but Matatu owners will support it. Most matatu owners are running losses...due to manambas and cops...cooking all excuses to give the owner very little.

It near imposible to find folks who have really thrived in matatu sector.....with cashless and gps tracking..it will be easy to manage matatus.

[Gumzo]

My 2 cents. It part of attempt to formalize the matatu sector. Our transport sector is really informa. This cashles move is in line with requirement to join saccos and all the attempt from Michuki time (uniforms, salaries, painting yellow line) are geared towards making the sector formal..this will allow gov to tax it eventually..but the sector will also grow given for example..banks will start seeing the cashflows of matatus.

It is a good move. Manamba and Cops will sabotage it..but Matatu owners will support it. Most matatu owners are running losses...due to manambas and cops...cooking all excuses to give the owner very little.

It near imposible to find folks who have really thrived in matatu sector.....with cashless and gps tracking..it will be easy to manage matatus.

Banks have all along seen the rich cash flows in matatu's and have been very active in asset financing matatu's
all those new spectacular looking big buses are financed in one way or the other by banks and now
akin Unitas (formerly muramati) types are fast moving into this cash rich sector.

[RV Pundit]

They are underleveraged...i think matatu sector is worth more...transport sector is probably worth as much as real estate..or housing. typically most nairobians spend maybe 150 per day...on a matatu..if you go with 2m matatu ridding folks paying 150shs...that is alot of money...150*2m..300M daily...in Nairobi alone...or 300*350 days...about 70B...nationally it maybe worth 200-300B annually....but given they are mostly informal....like our dukas..they are stunted there..

Some labour report claims since 2010..informal sector jobs have been earning more than formal sector...and matatu is the king in informal sector...those touts and makanga earn more than your typical teacher waiting for 15k a month.

According to some report i read (Mckensey) despite all mpesa and cards...we still have 98% cash transaction....going on.

Banks have all along seen the rich cash flows in matatu's and have been very active in asset financing matatu's
all those new spectacular looking big buses are financed in one way or the other by banks and now
akin Unitas (formerly muramati) types are fast moving into this cash rich sector.

[Mintos]

Cashless payment was meant to streamline the mathree operations but an opportunity has arisen out of the whole thing and is another cash cow for the cashless providers. E.g the #My1963 card that Uhunye launched the other day is owned by Itumbi and Kimutai (the MOA Chair).  #My1963 gets 3% of all fare transactions as handling fee. Imagine 3% on all levels of fare that a mathree charges whether peak or off peak periods. Kama fare peak time is 100 bob and off peak it is 30 bob these guys kula 3%.  Now if the mat owner expects a certain amount every day, it means he will have to factor the 3%, meaning fares will go up somehow. 100 bob fare will go up 3% so that the owner keeps 100 bob and pays kina Itumbi 3 bob.

[Gumzo]

Cashless payment was meant to streamline the mathree operations but an opportunity has arisen out of the whole thing and is another cash cow for the cashless providers. E.g the #My1963 card that Uhunye launched the other day is owned by Itumbi and Kimutai (the MOA Chair).  #My1963 gets 3% of all fare transactions as handling fee. Imagine 3% on all levels of fare that a mathree charges whether peak or off peak periods. Kama fare peak time is 100 bob and off peak it is 30 bob these guys kula 3%.  Now if the mat owner expects a certain amount every day, it means he will have to factor the 3%, meaning fares will go up somehow. 100 bob fare will go up 3% so that the owner keeps 100 bob and pays kina Itumbi 3 bob.

Which itumbi is this ?  PSCU ?

[Mintos]

Cashless payment was meant to streamline the mathree operations but an opportunity has arisen out of the whole thing and is another cash cow for the cashless providers. E.g the #My1963 card that Uhunye launched the other day is owned by Itumbi and Kimutai (the MOA Chair).  #My1963 gets 3% of all fare transactions as handling fee. Imagine 3% on all levels of fare that a mathree charges whether peak or off peak periods. Kama fare peak time is 100 bob and off peak it is 30 bob these guys kula 3%.  Now if the mat owner expects a certain amount every day, it means he will have to factor the 3%, meaning fares will go up somehow. 100 bob fare will go up 3% so that the owner keeps 100 bob and pays kina Itumbi 3 bob.

Which itumbi is this ?  PSCU ?

correct. Denno Itumbi of PSCU

[Omollo]

I have not heard of any benefits to the user. If it helps the matatu owners, then what role does the government play in that? Why should government get involved in how manamba share cash with the owner? It will not stop robberies because they can still capture the matatu get all the wallets and mobiles and then demand and get passwords to that system and hack it for money. They can target the owner or whoever has the access to the cashless cash. So in terms of security I go with vooke, nothing to gain there for robbers. Only kuruti take on matatus. The graduates have bigger fish to fry.

Why should I not be free to pay cash? There is some illegality here. There is no place on earth where one lacks the option of paying cash. Of course private clubs. I did end up in one such club in Nairobi while trying to meet some Frenchman who lived nearby and was told I couldn't buy anything there for cash. So is matatu now a club?

If the idea is taxation, why not be open about it? This is the time government should be offering subsidies to lower the cost of transport. Farmers should have long ago been granted tax free fuel to be used on the farm in farm machinery.