- Booking fee was introduced in the country in November 2022 by Uber and Bolt, after they were directed to reduce their commission to 18%.
- The fee was intended to help the firms circumvent the reduced commission charge.
Image: COURTESY
Bolt Kenya, whose licence renewal has been a subject of controversy has received the green light after clearance by NTSA.
The mobile app taxi-haling firm immediately announced that it would stick to the 18 per cent commission but suspend booking fee pending resolutions with the authority.
Suspended booking fee, which NTSA considers illegal, for much longer or its total scrapping off could mean increased burden on drivers in terms of VAT remission unless Bolt seeks an alternative to cater for the VAT costs.
Taxi hailing firms are required to charge drivers VAT on the service fee. However to avoid reducing driver earnings, the companies ride on booking fee to cover the VAT remitted to KRA.
The booking fee was introduced in the country in November last year by Uber and Bolt, after the ministry of transport directed all e-cab companies to reduce their commission to 18 per cent, slightly lower than their standard 20 per cent charge.
Paid by customers, the fee was intended to help the firms circumvent the reduced commission charge.
Responding to The Star on whether the current suspension should pose a concern on drivers' earnings, Bolt Kenya country manager Linda Ndungu said they have taken swift action in response to NTSA's concerns regarding the booking fee with regard to drivers' welfare protection.
“Bolt will always operate within the confines of the law and our commission will remain capped at 18 per cent as per the regulations. We remain committed to cushioning drivers on our platform from any developments that may negatively impact their take-home earnings,” Linda said.
“We are in productive discussions with the regulator regarding the booking fee matter, in pursuit of a mutually agreeable resolution.”
The National Transport and Highways Authority had declined to renew Bolt’s operator license early this month, sighting concerns that had to be addressed.
According to NTSA’s acting director general Cosmas Ngeso, among the reasons that impeded the renewal process was formal complaints from drivers and their representatives regarding alleged non-compliance and violations of the provisions of Transportation Network Companies (TNC), Owners, Drivers and Passengers Regulations, 2022.
"The most pressing concerns are in relation to commission charges and a booking fee which has caused significant concern among the driver community," Ngeso said.
He further noted that they had received complaints, along with substantial evidence that the online taxi company was charging commission rates higher than 18 per cent.
The imposed booking fee was also considered illegal by the authority.
"This is in violation of sub regulation (2) (g) of the TNC regulations," Ngeso said.
NTSA also had concerns related to driver and rider safety with customers accusing driver partners of sexual harassment and assault.