Home Finance Ekocab Launches e-Hailing Service with Lagos State Government
Finance - News around Africa - Profiles - Startup - March 10, 2020

Ekocab Launches e-Hailing Service with Lagos State Government

Ekocab Nigeria, in collaboration with the Lagos State Government, has launched Ekocab, an e-hailing service that will connect regular yellow taxi drivers and/or private car owners with commuters using the platform.

Founded in 2017, Ekocab signed a partnership with the Lagos State Taxi and Cab Operators Association in 2019 to onboard thousands of yellow commercial taxies on its platform. Just like other ride-hailing services, the Ekocab mobile app will connect a driver-partner and a rider who requests a ride, before the driver arrives to pick up the rider.

According to Segun Cole, co-founder of Ekocab Nigeria, in addition to yellow taxi drivers, private car owners will also be onboarded and given proper training and proper documentation as required by the government.

Nathaniel Gideon and Segun Cole – Founders of Ekocab Nigeria

Cole points out that the platform will be leveraging on a negotiable pricing model with thresholds, and will charge a 15% commission on rides from both yellow taxis and private cars via the app. The cost of an Ekocab ride is based on the distance of the trip, total travel time, and the base fare, which users can pay for using their smartphones.

He also reveals that the drivers, currently about 500 of them, were all provided smartphones during the training and orientation sessions and talks are ongoing with the government and banks to provide loans for 1000 vehicles.

Bridging the Divide Between Taxis and Ride-Hailing Platforms

Cole believes that the disruption caused by the likes of Uber and Bolt created some friction between regulators, transport unions, and ride-hailing services. Issues such as passenger safety, non-compliance with rates, and welfare of drivers were left unresolved.

He insists that Ekocab will solve these problems and improve the efficiency of the taxi system in Lagos since it is a service-delivery platform formed by a coalition of taxi drivers, city managers, transport regulators, and unions.

Considering the fact that heavyweights such as Uber and Bolt are still in negotiations with the state government over fees and licencing, and the cloud of uncertainty that has shrouded e-hailing services in recent months, the timing of this launch is especially telling.

However, given the presence of yellow taxis on the ekocab platform, it is not clear if they will be made to pay the proposed licencing fees being touted for e-hailing companies by the Lagos State Government.

Ride-Hailing Regulation in Nigeria

The negotiations between the ride-hailing platforms and the Lagos State Government stipulates some new regulations. Under those regulations, drivers on these ride-hailing platforms are required to have LASDRI card and a driver badge issued by the Department of Public Transport and Commuter Services of the Ministry of Transport. The vehicles on such platforms must have hackney permits issued by the Lagos State Motor Vehicle Administration Agency and be fitted with a tag to be issued by the aforementioned department.

The LASDRI card is a requirement of the new regulations stipulated by the Lagos State Government

Reports say that the new regulations from the LASG might mandate third-party operators like Uber and Bolt to pay N10 million naira and an annual renewal fee of N5 million if they have less than 1000 drivers. Third-party operators that have more than 1000 drivers will pay N25 million licensing fee and N10 million annual renewal fee.

READ MORE: South Africa to Further Regulate Uber and Other E-hailing services

Operators who directly own their cars and employ their drivers will pay only the license fee of N5 million if such operators have below 50 drivers. Those who have more than 50 drivers will pay N10 million for the operating license. Under the new regulation, the Lagos State Government will also earn 10% on the fee of each trip.

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