Get ready to tap and go. The South African government is making a decisive push to revolutionise public transport by developing a single, integrated smart ticketing system that would work across minibus taxis, buses, and trains.
The Department of Transport has formally invited the private sector to partner on this landmark project, issuing a Request for Information (RFI) to gather ideas and investment. The vision is to create a seamless commuting experience, eliminating the current jumble of paper tickets and cash payments.
“The private sector has an important role to play to make this a reality,” said Transport Minister Barbara Creecy. She explained that the system aims to make public transport easier for commuters while also helping the department manage revenue more transparently and efficiently.
This move would bring South Africa in line with many European nations. Commuters in France use the Navigo Pass, in Switzerland, the Swiss Travel Pass covers trains, buses, and boats, and in Germany recently launched the Deutschland-Ticket. These systems allow users to load credit onto a card or smartphone app and simply tap a reader at entry and exit points.
Solving a Fragmented System and a Tax Dilemma
Currently, South Africa’s public transport payment system is highly fragmented. A commuter taking a train, then a bus, and finally a minibus taxi must engage in three separate transactions. While trains and some buses use tickets, the vast minibus taxi industry remains a cash-dominated economy.
This reliance on cash is at the heart of a significant national issue: tax compliance. The Organisation Undoing Tax Abuse (OUTA) has highlighted that the taxi industry, with estimated annual revenues of R90-R100 billion, pays virtually no company tax. OUTA’s CEO, Wayne Duvenage, has called for the formalisation of the industry to address this.
The South African National Taxi Council (SANTACO) has pushed back against what it calls “misguided” accusations of tax evasion, stating that operators pay personal income tax. However, SANTACO spokesperson Mmatshikhidi Rebecca Phala acknowledged a “taxation loophole,” noting that the current tax framework does not fully accommodate the industry’s informal structure. A universal digital ticketing system could provide the transparent financial trail needed to resolve this long-standing impasse.
Learning from Past Failures
The road to a cashless taxi system is paved with good intentions and 14 documented failures. Private companies have tried and struggled to gain a foothold. Anthony Stewart, CEO of Waxd Solutions—which offers a tap-and-go terminal for taxis—pinpoints the reasons for past failures.
“The first main issue was internal politics in taxi associations between drivers and owners,” Stewart said. He emphasised the need to move beyond politics and show the industry that “this is about improving the business of running a taxi.”
A critical lesson from previous attempts is the need to understand the taxi industry’s immediate cash-flow needs. Stewart recalled one system that failed because, while it processed passenger payments, it didn’t allow drivers to pay for fuel immediately. “If they need fuel today, they need to pay today,” he stated, highlighting that any new system must cater to the entire ecosystem.
Beyond convenience for commuters, a successful system could be transformative for drivers, giving them easier access to financial services and the ability to prove their income formally. As South Africa moves towards this digital future, the government’s challenge will be to learn from the past and build a system that works for every link in the transport chain.
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