As the taxi industry in South Africa begins to adopt an e-ticket fare collection system, which will make commuters lives easier by not having to carry cash or worry about taxi drivers not having enough change for them, BusinessTech looks at the how much money each taxi makes.
It is widely reported, and sourced by the taxi industry body SA National Taxi Council (Santaco), that there are more than 200,000 minibus taxis in South Africa‚ generating more than R90 billion every year.
The actual figure is unknown because the industry in South Africa is largely unregulated, with no set fare among taxis and routes.
And while Reuters puts the annual revenue in the industry at closer to R50 billion, based on the former figure, each taxi makes an annual revenue of approximately R450,000. Assuming that the taxi is in operation every day of the year, bar Christmas, the average income stream for a taxi in SA, is around R1,236 per day, or R37,500 per month.
The e-ticketing project is expected to be expanded to other taxi routes, with the aim of completing a national rollout within five years.
The taxi e-ticketing system is owned and implemented by FairPay and TaxiChoice – and the commercial arm of Santaco is currently the sole shareholder, with Curve Group Holdings as the primary technology partner.
Chairman of TaxiChoice, Jothan Msibi, said the first phase – which is the JPM route – will enable commuters to load their FairPay cards via point of sale (POS) devices and kiosks at taxi ranks, though eventually these services will also be available in selected retail stores.
Apart from being able to process card payments, the equipment installed in taxis also contains a GPS device, and can act as a WiFi hotspot, providing commuters with internet connectivity while they travel.
According to taxi finance company, SATaxi, the average a taxi travels 6,500 kilometres per month, while the South African National Taxi council says that the taxi industry employs more than 600,000 people and transports 15 million commuters per day.
SATaxi says that each taxi creates seven jobs related to the industry, but reports show that taxi owners lose between 35%-50% of fares that are pocketed by drivers through a cash based system.