Early Success of AFC in Rwanda

Rwanda public transport operators are seeing early gains from automated fare settlement leaves hundreds of unemployed.

Typical Problems for Under-developing Countries

Fleet owners are hesitating to implement an automatic fare collection system because it is not working smoothly in other countries in Africa. It is a common problem for Africa and other under-developing countries before the system can help to reduce revenue leakages due to collusion and corruption, it will make the owners’ income traceable and exposed to higher taxation.
Kigali Bus Services (KBS), which pioneered the card system in Kigali, said the loss of revenue was a common problem among operators because the money went through many hands — the conductor, driver and the company accountant.

Big fleet operators blame the revenue leaks on collusion between the conductors, drivers, and accountants, making it hard for them to pay bank loans.

Coupled with high operational costs, the revenue leaks were exacting a heavy toll, sending many into bankruptcy, explaining the high number of public transport companies that fold yearly.

Immediate Impact

After the entire city commuter fleet switched to the automated payment system however, owners are reporting a 50 percent increase in daily revenues.

Before switching to the AFC system, the drivers used to bring Rwf25,000 to Rwf30,000 daily, they are now getting the targeted Rwf50,000.

The role of AFC operators

the smart card system, the money passengers load on their cards does not get to the bus company directly.

It is banked in an escrow account monitored by the operators before it is distributed according to the number of passengers. The AFC operator earns five percent commission off the gross revenue collection per bus.

 

To learn more about the financing and business model as an AFC operator, visit autofare.net

Post Author: Keith Lau

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