Have you been once refused a ride by a Taxify driver because you are paying with your card? I almost was. Well, I used the opportunity to investigate the cause and here is what I learnt.
A Flashback to the Card Crusade
A few weeks back, Taxify rolled out its campaign to get users to use the card payment option on its app. The attraction for users is a 2,000 Naira bonus on the next trip. If you are a regular user of the app, just like me, 2,000 bonus is very attractive.
Going by the rush to join the app for the bonus at inception, the prospect of being able to go to places tax-free should guarantee some compliance (although I cannot lay my hands on Data).
In my case, I had to activate my bonus (I am a slow adopter when it comes to freebies) when I had to get out of the Island very late at night under heavy torrents. And, it was very useful (by the way).
The same night, I got into the cab after waiting for Oyewale (not real name) for a few minutes. Apparently, the Taxify app does not allow the drivers to see some details about the rider before “starting the trip”. So, Oyewale only knew where I was going and how I intend to pay when he started the trip.
And, he nearly ended the trip because I was paying with my card.
I was told by a taxify driver today that it takes time before taxifyNg remits the money made through card to them. Its annoying really when drivers decline card payment.
— Levi Dola (@adelekealfie) June 23, 2018
For whatever convictions, he decided to change his mind and that opened up a conversation about the card payments and the reason drivers are reluctant to accept that option. His explanations are summed up thus:
Taxify drivers need cash at hand, at all times, for recurring costs such as fuelling, maintenance, feeding etc. Since these costs are borne by the drivers, they should not be at the end of the payment chain.
One of the most annoying things about booking Taxify or Uber is waiting 30 minutes for a driver, only for him to arrive and tell you he doesn't want card payment or he doesn't want to go to your destination.
— Onye Nkuzi (@cchukudebelu) May 31, 2018
According to Oyewale, Taxify takes 15% of the total revenue and cash model allows them to remit the quota after they have settle bills and paid vehicle owners (in most cases). Now they will have to wait for a week to receive their quota. If you understand how the transport system in Nigeria works, you will know that going cashless is risky
I am not advising Taxify to back-off this campaign. My point is that the drive should be accompanied by a commensurate cash disbursement efficiency that will win the drivers’ trust.
Oyewale spoke about the inability of many drivers to receive the daily bonus offer by Taxify owing to time constraints. According to Oyewale, the target of 40 pickups begins to count after the peak hours. Hence, they end up chasing the target daily in vain.
He is of the opinion that the bonus should not be again or lose the offer. If you are able to pick up 36 out of 40, the bonus should be prorated. Otherwise, the efforts can be converted into points and rewarded at the end of the month.
With this, I agree.
The Benefit of Card Payment
This move certainly has its benefits.
One, it will help Taxify shorten its receivable window as it will be the primary recipient of the fees. It is also going place Taxify in the position to completely decide the share accruable to other key players and when it will be received. It is surely also going to help the app regulate the conduct of drivers and partners.
In fact, cab owners will be better suited by the development as they will be able to monitor in-floes and measure their drivers. But, Taxify needs to tidy its acts too:
The Consequence of Continued Rejection of Card Payment Option
Of course, all these are predicated on the assumption that there will be a wide-scale adoption. The effect of the continuous rejection of the “Taxify payment” option will force desperate users to negotiate other ways out. And, these are abundant! Drivers and riders can discuss an offline price and settle themselves.
Also, the drivers can simply estimate the price with the app and cancel the trip somewhat but proceed offline. In either case, Taxify will lose 100% revenue.
In the instance that the rider is not desperate, he/she will wait until the right driver shows up. Talk about the time cost. They may also switch to another app to get going. This way Taxify will most likely lose a user but drivers can switch apps.
In many other instances, the riders will vote with their feet…
This ish with taxify drivers and cash payment. I've had two cancelled requests on one trip because I opted for card payment. Not funny! #Taxify
— Chika H. Orji (@orjichikah) June 20, 2018
Overall, while it is true that new methods (in fact, all innovations) face early adoption challenges, ensuring a smooth transition is achieved can help Taxify lessen frictions. My experience with Oyewole has revealed that Taxify can do better to steady its hold on its existing stakeholders.
Time is of the essence!
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