Uber bullish on Kenya after leaving from Uganda, Tanzania

“Kenya remains an important market for Uber, and we continue to see strong potential for the business here,” Uber told the Business Daily via email.

Uber entered Kenya in 2015 and is one of the leading ride-hailing platforms in the country, competing with Estonian firm Bolt, Russia’s inDrive, Rwanda’s Yego and local players Little and Faras.

But the company has faced pressure from drivers who have gone on strike and staged protests in recent years over rising operating costs, low fares and high commissions — fees Uber deducts from drivers’ earnings for every completed trip.

In 2014, the company raised its minimum fares by 10 percent in Kenya following driver strikes and protests over unsustainable earnings amid high fuel and vehicle maintenance costs.

“We recognise that (Kenyan) drivers are facing pressures from rising fuel, maintenance, insurance and other operating costs,” Uber said.
“Our focus is on supporting sustainable earning opportunities and helping drivers manage their costs, while ensuring that mobility remains affordable and demand remains strong.”

Drivers in Nigeria and Uganda also raised similar concerns. In Tanzania, Uber was involved in a long-running dispute with the transport regulator, LATRA, over commission caps.

In 2022, LATRA introduced fixed guide fares per kilometre and per minute, set a minimum fare and lowered the commission ceiling from 33 percent to 15 percent.

Uber halted operations that April, terming the model unsustainable. It resumed in early 2023 after the regulator allowed commissions of up to 25 percent and restored a booking fee.

Commenting publicly for the first time on the Tanzania exit, Uber’s general manager for East Africa, Imran Manji, said regulating fares and commissions had become an “obstacle” to the firm’s expansion.

“Unfortunately, sometimes in this region we tend to put in place obstacles… if you, as a regulator, put in place price floors and price caps on the private sector, you're killing innovation,” Mr Manji told a forum in Nairobi.

“Around the world, Uber is live in 10,000 cities, and only three countries cap commissions: Portugal at 25 percent, Tanzania at 25 percent and Kenya at 18 percent. We are an outlier in the wrong direction.”

He said Tanzania’s restrictions prevented the company from introducing premium ride tiers such as Comfort or Safari, which are available in markets such as Kenya.

“You cannot even launch electric bikes because you cannot price lower, even though they are cheaper to run than petrol bikes … ultimately, it led us to exit Tanzania,” said Mr Manji.

Kenya, however, also faces regulatory uncertainty over commissions and minimum fares. Last week, the High Court blocked enforcement of the 18 percent commission cap that Uber and its competitors charge drivers and vehicle owners.

The move marked a win for operators, who have long opposed the limit. The State introduced the cap in 2022 as part of efforts to protect drivers from high fees, down from previous rates of up to 30 percent.

The National Transport and Safety Authority currently caps ride-hailing platform commissions at 18 percent per trip, including digital service tax.

The High Court, however, found the restriction unconstitutional, saying the State had not demonstrated its necessity or proportionality through the required regulatory process. It also said the price-setting provisions lacked statutory foundation and economic justification and constituted “an unconstitutional deprivation of property and contractual autonomy”.

“We will continue to engage constructively with the relevant authorities and stakeholders,” Uber said in response to the ruling.

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