Jasvin Naidoo, CEO of Twytch SA, a new e-hailing company set to launch in South Africa, discusses e-hailing's most important yet undervalued assets—its drivers.
South Africa’s e-hailing industry is at a crossroads. Once a revolution in urban mobility, it has become an ecosystem fraught with inefficiencies, regulatory gaps, and economic inequalities. The future of e-hailing in South Africa is not simply about moving people from one point to another; it is about reimagining how value is created and distributed across the entire network—drivers, passengers, regulators, and service providers. The countries that succeed in this will be those that merge technological advancement with financial inclusion, safety, and regulatory engagement.
Lessons from Africa
South Africa is not alone in facing challenges in the e-hailing sector. Across the continent, countries have adopted different approaches to regulation, driver empowerment and safety. Kenya, for instance, has introduced strict regulatory and tax compliance requirements for e-hailing operators. To shield drivers from exploitation, the country regulates the maximum commission paid by the driver or owner of the vehicle.
In Nigeria, e-hailing companies must provide the state with access to their databases, including accident reports, to enhance security and regulatory compliance.
Rwanda has prioritised driver-training programs that have improved service quality and passenger safety. While the country has acknowledged that well-managed taxi services, like ride hailing, can improve access to economic opportunities, it is also of the view that these services are not a substitute for a robust public transport network.
South Africa, with its unique socio-economic landscape, has the opportunity to forge a path that addresses both innovation and social responsibility.
Regulatory fragmentation
Regulatory uncertainty is one of the greatest challenges facing South Africa’s e-hailing sector. While the National Land Transport Amendment Act (NLTAA) has been signed into law, its implementation date has not yet been set, creating a regulatory gap.
Municipalities have the authority to implement localised regulations, which means the requirements and enforcement can vary between cities like Cape Town, Johannesburg, and Durban. Some municipalities may impose stricter vetting processes or additional safety measures.
The formation of an e-hailing body in South Africa with representatives from government agencies, e-hailing platforms, and driver representatives could serve as a unified voice for fair regulations that promote both safety and driver rights.
Financial exclusion and unsustainable models
E-hailing drivers in South Africa operate under a high-risk, low-reward model. Platforms take exorbitant commission rates, leaving drivers with minimal earnings after covering fuel, maintenance, and vehicle financing. Many drivers sign up for car rental agreements for thousands of rands a week, deepening their cycle of financial instability. Some drivers sleep in their vehicles at airports overnight hoping that a morning trip would take them closer to home.
The current operational model presents a significant risk due to the correlation between driver income generation and vehicle rental commitments. This structure necessitates extended working hours, leading to heightened driver fatigue. Consequently, both driver and passenger safety are compromised, potentially resulting in increased accident rates and associated liabilities. This situation necessitates a review of existing compensation and rental structures to mitigate these risks and ensure sustainable, safe operational practices.
The algorithmic pricing and operational policies of international e-hailing operators frequently clash with South African economic realities, creating friction points throughout the service delivery chain. This approach has left the market vulnerable to practices that extract value rather than create sustainable local ecosystems.
Emerging players like Twytch are attempting to disrupt the exploitative framework by introducing driver-centric models that emphasise fair remuneration structures, allowing drivers to retain a larger share of their earnings. It is also pushing for access to ethical vehicle financing and financial literacy programs to empower drivers to manage their income effectively. By prioritising financial inclusivity, the South African e-hailing industry can shift from extractive business models toward wealth-building opportunities for drivers.
Safety
The safety concerns plaguing South Africa’s e-hailing industry demand immediate attention. While platforms have implemented reactive measures such as emergency buttons and ride tracking, these fail to address the root causes of security risks. Twytch is transforming the e-hailing industry with blockchain-backed identity verification, ensuring greater security and peace of mind for both drivers and passengers.
Ethiopia offers a notable example of a safety-centric approach, where e-hailing platforms collaborate directly with local law enforcement to provide real-time security monitoring. South Africa must adopt similar, proactive measures, such as the use of AI-driven risk assessment tools to predict and prevent high-risk trips, as well as greater collaboration with SAPS and Metro police.
Platforms that integrate these security innovations will not only reduce crime but also restore public trust in e-hailing services.
The way forward
If South Africa’s e-hailing industry is to thrive, it must embrace a fundamental shift in its operational philosophy. The future of mobility is not just about faster rides and cheaper fares; it is about building an ecosystem that values people as much as profits. Industry leaders must collaborate with regulators to establish clear and fair policies that protect all stakeholders. Technology must be leveraged to enhance safety. Equitable financial models that empower drivers rather than exploit them must be put in place, and local innovation must be encouraged to reduce our reliance on foreign-owned platforms that prioritise global scalability over local impact.
South Africa’s e-hailing industry has to make a choice: continue with the status quo or redefine what mobility means in a way that is innovative, inclusive, and just.
