Uber are using SA as a Guinea pig. Quite why they don’t use Guinea as a Guinea pig is slightly beyond me, but still, SA it is. The experiment in question is whether cash payments for your Uber ride is a good/viable alternative to the “traditional” credit card.
South Africa becomes the first country in Uber’s global network to experiment with cash payments across five cities simultaneously and was selected because of its low credit and cheque card penetration.
Indeed. Apparently, cash makes up 65% of all transactions in SA, and while Uber says:
Uber riders in South Africa already have access to a reliable, convenient transportation; paying by cash just means more South Africans can enjoy this.
What they obviously also mean is that more people can use Uber and therefore increase their profit margins. But there’s nothing wrong with that – it’s how business works. In fact, it’s quite nice that for once the customer gets something out of it as well.
So, with the rest of the world moving away from cash as a payment form, I was interested to learn that Uber thought that this was a big enough deal to try this experiment. While the 65% figure above suggests that it makes sense, how many of the individuals who are making those cash transactions actually have a smartphone (which is still required for an Uber account/booking)? Smartphone penetration is “over 45%” in SA, and I would have thought that debit/credit card ownership (there are over 50 million cards currently in circulation in SA) would have covered most of that 45% already. Also, I’d reckon that the majority of people who don’t have a card wouldn’t live in urban areas anyway.
Urban areas are where Uber operates. Urban areas and Port Elizabeth.
In short, I’m surprised that Uber feel that a lack of a cash payment option was the rate limiting factor here.
Not everyone will have the cash option just yet. It’s being rolled out, and once you get it (I have, although I’ll probably never ever use it) you’ll see this screen upon opening your Uber app.
As for safety, with Uber drivers carrying cash now, will they become more of a target for thieves, skollies and skelm? Hopefully not, say Uber:
While it is unlikely that driver-partners will be carrying a large amount of cash, they will be able to deposit cash, at any time, into various FNB ATM’s across South Africa. We have also encouraged them to do regular deposits and keep as little cash on them as possible (by using their cash to pay for fuel and supplies).
Which is sensible. And it should be remembered that “regular” taxis carry money around all the time and we’re not hearing reports of them being mugged 24/7.
Well, no more than anyone else, anyway.