Uber eyes use of mobile money service in Africa

The service has been launched in Cape Town, Johannesburg, Durban and Pretoria in South Africa; Lagos in Nigeria; Cairo; and Nairobi, Kenya. Uber offers a cashless service, mainly targeting credit card holders, but the low penetration rates of cardholders outside South Africa has affected uptake.

In Kenya, most of the transactions are in cash or through mobile money services, commonly via the M-Pesa system. When Uber launched last week, online users voiced dissatisfaction with the inability to use M-Pesa. Kenya's public transport system has a cashless system that uses M-Pesa.

"We can confirm that we are exploring the possibility of integrating the M-Pesa service in our system, but we don't yet have expected time when this is likely to roll out," said Alastair Curtis, a manager of international launches for Uber.

In most African cities, the transport system is not well regulated, and taxi drivers have been involved in criminal activities, but Uber says it provides the safest, most affordable and reliable rides.

"Uber is the 'gold standard' when it comes to consumer safety and this is all because of the technological innovation in the app," Curtis said.

To improve security, Uber says the drivers go through rigorous criminal background checks, and it provides customers with driver information, a live GPS-enabled map that can be tracked by friends and family, rider feedback and driver safety by ensuring the service is cashless.

Apart from providing reliable and affordable services, Uber is promising to provide employment to young people in the seven cities.

"Uber's lead generation software facilitates a powerful entrepreneurship opportunity; every month going forward, Uber's mission is to empower many young entrepreneurs to become small-business owners," Curtis added.

Africa is also known for traffic congestion. This can affect Uber's pricing model, which is based on distance and time spent in the taxi. Curtis did not offer any insights on how Uber will tackle the problem of traffic, which is likely to curtail its growth in some cities.

To contain any disquiet among taxi operators in the region, Uber insists it is a technology company and not a taxi or transportation company, and that it does not employ drivers or own any vehicles.