SafeBoda riders and passengers reconsider their relationship

Photo Credit: SafeBoda Facebook Page

When SafeBoda launched in 2015, it was the first ride-hailing company in Uganda and has been the dominant player ever since. It began as a community of drivers of motorcycle taxis, known locally as boda-bodas, who have been part of the transport ecosystem in Uganda for decades. The rapid urbanization of Ugandan society wasn’t matched by investments in road infrastructure, and Kampala’s streets are cramped and crowded with traffic, making boda-bodas, which can flit between cars and minibuses, an efficient and affordable way to get around. However, without protections for drivers or passengers, and with the no-holds-barred nature of driving in Uganda, this form of transit is notoriously dangerous.

As its name suggests, SafeBoda started with focusing on tackling the safety problem by training riders on safe driving and by providing them with passenger helmets, a novelty in Uganda. The company’s co-founders — Alastair Sussock, Maxime Dieudonné, and Rapa Thomson Ricky — have raised funding from investors including GoVentures, the investing arm of Indonesian ride-hailing unicorn Gojek (now part of super app company GoTo), as well as Allianz X, the venture arm of German insurance giant Allianz, Transsion Holdings, the Chinese phone maker, and, recently, Google. But unusually, given the high-profile names of its backers, the company has declined to share how much it has received to date, despite multiple inquiries from Rest of World

To expand operations and increase the number of drivers on the app, SafeBoda followed the global ride-hailing playbook and began offering hard-to-reject bonus incentives to people who signed up. 

SafeBoda didn’t have the market to itself for long. Taxify (now Bolt) entered the Ugandan market in late 2017, followed by Uber in 2018. Both also offered incentives for motorcycle and taxi riders, but both have since focused exclusively on cabs.

By September 2019, SafeBoda had dropped its bonuses, from as high as between 50% to 100% of trip fares down to 15%. And it began charging a 5% commission on each trip. For Sulaiman Kamweso, 43, who has been driving a motorcycle taxi in Kampala since 2009, it no longer made financial sense to stay on the app. He said that the app would connect him to a customer at a distance he would normally charge 1,000 Uganda shillings to drive to when not on the app. After driving to the location to pick up the customer, he would take them to their destination for a fare of 2,000 shillings. He then would receive a 10% bonus, but the company would deduct its 5% commission. In addition, Kamweso would spend about 7,000 shillings (~$2) a day on airtime and data. 

“In simple terms, I would already be at a loss,” Kamweso said. A rider who wasn’t on the SafeBoda app could charge such a customer 4,000 shillings ($1.15) and wouldn’t be spending money on the fuel he used to pick the customer up. In September 2019, he decided to leave the app.

The drivers’ situation was compounded by the pandemic. In March 2020, Uganda imposed stringent lockdown conditions, including transport restrictions, many of which lasted into early 2022. Boda-bodas were barred from operating past 6 p.m. Motorcycles in the country resumed working 24/7 on February 7, after the country’s president, Yoweri Kaguta Museveni, removed the last of many directives that affected the sector, almost a month after the same directives had been dropped for the rest of the economy.

According to drivers, the commission is currently 15%, and bonuses are calculated in the form of points. Riders get eight points for each trip paid for in cash and 20 points for cashless trips, and, after accumulating 60 points, the riders can convert the points  into 2,500 shillings (70 cents) of cash.

The changes are beginning to have an impact, according to some customers. Grace Kusasira, 35, a businesswoman in Kampala and mother of three, said she has faced the wrath of SafeBoda’s riders who have rejected cashless payments; demanded additional money, arguing the app pays them less; and demanded they be allowed to start a trip before they reach her. “We lost the convenience,” she said. Kusasira said that the last time she used the app was in January, when a rider she requested arrived where she was and asked cash or cashless. When she said cashless, “he drove away,” she said. Customers complaining of riders rejecting cashless online payments have become a common occurrence.

SafeBoda would not reveal the number of riders currently actively using its app but confirmed that people have been leaving the service. Co-founder Ricky said that the principal cause was the pandemic, which had left riders in financial difficulties. He said that the 15% commission the app charges is less than established ride-hailing services. Uber and Bolt, for example, usually charge drivers around 20%–25%. He also said riders did not seem to appreciate promotions that the company gives them.

Ricky said the lesson SafeBoda took from the pandemic was that it needs to diversify and follow the example of investor Gojek, which expanded beyond transportation to become a broader super app. SafeBoda partially switched to deliveries during the pandemic, which helped it to bring in revenues when passenger transport was restricted.

“Do I believe SafeBoda would have been profitable without other features on the app?” Ricky said. “It’s clear with data available that it would be impossible.” 

The app now offers food delivery services, airtime purchase, cashless payments, mobile money transactions, and a savings scheme in which users are offered a 10% annual interest on their savings. Adding fintech services might make the company more attractive to investors, given the high valuations being placed on startups in the sector over the last couple of years.

“The goal of a super app is to make more revenue on the same user, the same [driver], and the same merchant, because the app has multiple channels and multiple services,” Raphael Dana, co-founder of West African super app Gozem, which also began in ride-hailing, told Rest of World. He said the startup, which launched in late 2018 and has about 5,000 riders, is expected to break even in countries including Togo and Benin by end of next year. 

Kenneth Legesi, CEO of Ortus Africa Capital, an investments and advisory firm in Kampala, said SafeBoda is on the right path with its desire to become a super app. “It will allow you to be able to break even faster in African markets,” he said. “By diversifying away from just the ride hailing, they’re able to generate more business for their riders,” he says.

But laying the foundation for that super app has also created tensions with riders. 

At the same time that bonuses were dwindling, customers were offered discounts to switch to cashless payments. The move was part of SafeBoda’s plans to expand beyond ride hailing and to create a digital wallet — a core element of the super-app offering. The e-wallet is often touted as promising a better, frictionless experience for the riders in their cash-free interactions with passengers. This can make a notable difference in a market like Uganda, where credit card penetration is low.

But the riders felt that the company was essentially taking money from them to subsidize customers. Customers complaining of riders rejecting cashless online payments have become a common occurrence. “SafeBoda had stopped valuing us much. It’s the customer who they are valuing,” said Dungu Steven, 30, a rider who left the app in December 2021, after almost three years.

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