But at personal level I shied away from acquiring a card. Google is one of the power houses behind NFC based payment through its Google Wallet yet it did not provide an option where those with NFC enabled phones could use their phones instead of being forced to buy a BebaPay card. I did understand that there are a number of Kenyans who couldn’t and still can’t afford smartphones let alone smartphones embedded with NFC technology. But again since the entire BebaPay platform was based on NFC, those with NFC phones ought to have been allowed to use their phones instead.
I hate cards (ID cards, ATM cards, all cards). That’s what I disliked about BebaPay.
After the initial implementation of BebaPay, a copy cat by the name My1963 backed by Safaricom and the government joined the industry. Four months ago the NFC based PSV Cashless Payment System ‘my1963? was officially launched in which commuters would be required to tap their cards against a terminal installed in Public Service Vehicles to pay their fare. During the launch, President Uhuru Kenyatta, Transport CS Michael Kamau and Safaricom CEO Bob Collymore among other high profile individuals boarded a matatu to demonstrate how My1963 works.
Related Article: Cashless System in Kenya remains a dream
Government’s backing of My1963 was not in order
There are a lot of unverified information that purport that My1963 card is a project by someone who works under the nose of the President. Cofek had issued an alert that My1963 could be Dennis Itumbi’s project and that’s why it received so much backing from the President and other state organs. Whether the rumors are true or not, the fact that the government put its foot in the affairs of private sector was totally out of order.
The function of the government when it comes to private sector is to offer regulatory framework in which every player is given a fair chance to effectively compete. This is not to say that the government should not engage in income generating activities like owning shares in entities such as Safaricom and National Bank, but rather that it should not be involved in the day to day operations of businesses in the private sector.
When the government directly promoted My1963, one of the things it did is to ask matatu owners to fit gadgets that are only compatible with My1630. Secondly, since My1963 has Safaricom by the side, only Safaricom subscribers are able to top up the cards.
As it appeared, it was planned that in the long run My1963 would become a monopoly in the PSV cashless payment system.
Cashless payment cannot be forced down our throats
My1963 was officially launched sometime in November. On the launch date, the government announced that by December 2014 all PSVs in Nairobi will be required to reject cash, failure to which the matatu in question would incur penalties. December came and past. We got into January, we still paid cash in all PSVs in Nairobi.
Then in the beginning of February Eastlands matatu saccos threatened to enforce cashless fare system starting February 2nd in the evening. Some of the saccos that issued the threat included Ummoinner, Compliant, ROG, Royal Swift, Mwamba, Pin Point, Prime East, C-Bet, and Oma. The same evening I decided to test them I got into one of Ummoinner buses and I paid in cash. Only two people paid using the My1963 card.
A week later, in the same Ummoinner buses, a passenger attempted to pay his fare using My1963 but he could not – the manamba’s phone could not read the card – end of story.
It could be BebaPay has not ditched the Kenyan market simply because the government is supporting My1963. The reason could be the cashless payment business in PSVs did not pick up because the manambas hate the cashless payment system altogether. Commuter experience has it that manambas and drivers of the PSVs are not supporting the cashless cards. If the NFC phone meant to read the card is not working, then “system down” would be the response from the manamba to those who want to pay using the BebaPay or My1963 cards.
The manambas’ refusal to accept BebaPay and other cards means that commuters would end up having unused monies on their cards and finally these monies would go to waste. If the card was declined the previous day, there will be no reason for me to attempt using the card today or the next day.
The reasons that make the manambas decline the cards are simple, it deprives them of the “commission” they never handover to the matatu owner.
The way the manambas operate is that they try to ensure that the matatus are filled to capacity with hopes that some of the passengers will alight along the way. When such a passenger alight and a new one takes his place, then the fare from the new passenger is pocketed. If there are 5 such “along the way passengers” each paying Shs 30, then per trip the manamba will pocket shs 150 totaling to shs 750 in five trips – which could be more than the monthly salary the matatu owner is willing to pay him.
The two to three attempts by the government to enforce the cashless payment in the public transport in Kenya have not addressed the plight of the manambas whose income will be grossly affected if cashless payment finally takes off. As I explained in the article Lessons you should learn from the death of Safaricom’s vumaonline, key questions that need to be asked at the implementation of new systems and projects include:
1. Who are the players, 2. Who would be happy with the initiative and why? 3. Who won’t be happy and why? 4. How do we sort out the reasons they won’t be happy? 5. Who would want to eat from the initiative and how do we deal with them? etc etc.
If the government honestly asked itself the third and the forth questions, they could have come up with a strategy that takes care of the manambas and drivers even as they adapt to the new system.
Thus, even if BebaPay’s exit has nothing to do with government’s promotion of My1963 but is purely based on market synthesis, the government is still to blame as it didn’t do adequate market analysis and diagnosis before enforcing the cashless payment system.
Maybe our economy only needs Lipa Na M-PESA for cashless payments. I am not sure there is a way the Lipa Na M-PESA platform can be meddled with by the manambas.
I believe more than 65% of Kenyans, by today, are ready to use Lipa Na M-PESA. If enforcing Lipa na M-PESA will be seen as biased the same way enforcing My1963 is, then the government can expedite the opening up of M-PESA to all players so that Safaricom is no longer associated with the M-PESA.
Let cashless payment be taken up holistically
When it comes to payment, the economy cannot be segmented. I do not understand why the government expects commuters to have one form of payment for one sector of the economy and a totally different one for all the other sectors. If the government wants to implement cashless payment system, they should do so across all sectors including the informal sector.
It’s sad BebaPay is leaving us, and we have our government to blame for the chaos in the cashless payment it has been trying to enforce in the PSV sub sector. You can read about BebaPay’s exit from the Kenyan market on Business Daily.