By Lynette Mukami
When Uber first began operating in Nairobi four years ago, early adopters were only too happy to have an on-demand taxi service that was cheaper and took away the headache of haggling over fares. The initial driver partners were said to have made a killing with anecdotal reports indicating that they got returns on their investment, mostly from loans, in under a year.
In the beginning, traditional cab drivers were oblivious but soon caught on to the disruption that was happening right under their noses. Predictably, the realization that there was a new player eating their lunch led to an explosive reaction.
Four years and several e-hailing driver strikes later, it is clear that the law, industry players and policymakers are still not prepared to deal with technology-based disruption that has also gone on to hit other sectors.
REGULATORY HOLES
Uber and Estonia-based Bolt were just the beginning. The arrival of other disrupters like Airbnb and most recently, Egypt-based Swvl, has exposed Kenya as an antiquated regulatory wonderland. Policymakers appear to have been caught completely flat-footed by the influx of platform-based businesses whose models Kenyan laws do not understand.
So far, the initial State’s response has focused on how to tax these enterprises while issues such as fair competition and labour are relegated to the back burner. For instance, the Ministry of Tourism on realizing how lucrative the Airbnb space has been for homeowners has moved to tax those profiting from the platform.
The US-based homestay rental platform had 6,500 Airbnb listings in 2018, which earned homeowners Sh510 million between January and September that year. The previous year, they had raked in Sh390 million, underlining how popular it has become among local and international tourists…
