Ride-hailing giant Uber has resumed its services in Tanzania, after a long suspension the company embarked on, following the government’s regulatory changes that were enforced effectively from April 2022.
According to the rail-hailing company, the regulatory changes affected its ease of doing business hence the decision to suspend its service in the Tanzania market.
Lorraine Onduru. Uber’s East and West Africa head of communications highlighted the effect the new regulatory policies would have on the company. She said,
We made the difficult decision to pause our operations in Tanzania because the regulatory changes that were introduced created an environment that was challenging for our business to operate under.Lorraine Onduru. Uber’s East and West Africa head of communications
However, the rail-hailing platform is back in business. It is uncertain what the reason for resuming is but this is after Tanzania’s transport regulator, Land Transport Regulatory Authority (LATRA), and stakeholders lobbied for the rates to be reviewed.
Following this, the transport regulator last month approved and allowed ride-hailing companies to charge up to 25 percent commission and a 3 percent booking fee.
Speaking on this new service resumption, Lorraine Onduru. Uber’s East and West Africa head of communications, said,
We welcome the new pricing order issued by the Land and Transport Regulatory Authority which we believe will significantly contribute to the growth and development of the ride-hailing industry in Tanzania.Lorraine Onduru. Uber’s East and West Africa head of communications told Techcrunch
This decision by LATRA also affected Uber’s rival, Bolt, and according to TechCrunch, the ride-hailing company might be looking to introduce some changes to passenger fare pricing.
Ride-hailing company, Uber and regulatory policies
It is nothing new for the government to develop and amend industry policies, but occasionally these policies are not viewed favorably by the industry’s participants and have had an impact on businesses’ financial standing, which is frequently reflected in consumers’ payments.
Ride-hailing companies are one encouraging development in Africa that can use technology to assist solve challenges like ineffective urban transportation and the rising rate of youth unemployment. But because of regulatory policies, this industry as well as other startup industries have had to deal with several difficulties.
Being one of the leading ride-hailing companies, Uber has also been a victim of certain regulatory policies made by some countries. Apart from Tanzania, in 2022, Kenyan authorities decided to set a maximum on the commission charged for each ride at 18%.
According to Uber, the new digital taxi-hailing rules were unconstitutional and would harm its earnings, and potential investments but despite these ride-hailing companies’ attempts to have new laws dropped, Kenyan authorities remain unfazed.
Get the best of Africa’s daily tech to your inbox – first thing every morning.
Join the community now!