Taxi council to roll out system for paying fares without cash
Thursday, 11 August 2011 |  Nicky Smith  |  0 comment

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THE South African National Taxi Council (Santaco) says its plans to make travelling by taxis a cash- less experience will improve driver behaviour, lift profitability for the 130000 operators and increase the amount of tax paid by the industry.

The biggest challenge for the Department of Transport was the restructuring of the public transportation system, the Arrive Alive campaign said.

The move to a cashless regime was meant to create efficiency and increase earnings for taxi operators, who normally are at the mercy of their drivers. Santaco business development officer Nkululeko Buthelezi said as much as 40% of the fare paid to the driver stayed with the driver.

"A lot of money disappears in the system."

The industry transports 15- million to 16-million people a day and contributes R35bn to SA’s gross domestic product , Santaco CEO Bongani Msimang said.

The conventional arrangement between a taxi owner and driver results in the driver committing to a daily target of about R500. He would get a weekly wage but had the opportunity to push up his earnings by maximising fares falling over his target.

Over the past two years, Santaco has run a pilot project with about 100 taxis that run between Menlyn in Pretoria and the Johannesburg city centre, where commuters use preloaded smart cards to settle the fare. The driver swipes the card using a point of sale device in the vehicle.

The project is part of a plan to meet Santaco’s strategic objectives by 2020. These include an operator loyalty programme launched last week and an airline service due for later this year.

In the pilot, operators were pocketing as much as R2000 a day, he said. "It has made a huge difference.

"Obviously the drivers don’t like it, but we are changing their working conditions. They move into a contract environment with a minimum wage, UIF and bonuses," Mr Buthelezi said.

Santaco, which represents about 94% of the industry in the country, expects to start offering its operators the cashless system by the beginning of next year starting with the taxis plying the long-haul routes.

The national rollout of the system may take about five years . The association was "finalising" the system software, said Mr Buthelezi. The Reserve Bank and unnamed banks will act as a clearing house for the R100m paid to operators daily.

The system would work through commuters swiping a preloaded smart card on boarding a taxi. The fare is deducted from the card and collected at a clearing house. At the end of the month each taxi would be debited for insurance, maintenance and driver costs, with the balance of the takings going to the operator.

Mr Buthelezi said the system would also capture the "real value" of the taxi industry. The operator would be obliged to disclose to the South African Revenue Service how much cash the vehicle had made.

"We as an industry pay tax and we want to pay tax, we are not afraid, but you don’t know if that person is putting his money in the bank or keeping it in his house."

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