By For the past decade, the price of a ride from Westlands to the CBD has been set not by any government office but by an algorithm, one designed in San Francisco or Tallinn, optimised for global platform metrics, and adjusted in real time based on demand signals that have nothing to do with what it costs to keep a car on Nairobi's roads.
The Ministry of Transport now wants to change that.
According to a work plan cited by Business Daily, the government is developing a National Taxi Policy that would introduce a standardised pricing framework covering both conventional taxis and ride-hailing platforms including Uber and Bolt. The policy would evaluate driver and operator cost structures to determine minimum viable fares, and design a fare structure that includes base fare, distance rates, time rates, minimum fare, and regulated surcharges.
"The overall objective is to develop a national taxi policy that provides a coherent, sustainable, and harmonised framework for regulating, managing, and promoting safe, efficient, inclusive, and sustainable taxi services in Kenya," the ministry stated in its work plan.
If that language sounds familiar, it is because Kenya has been here before, several times. And every previous attempt to regulate this sector has either stalled in court, been quietly shelved, or been implemented on paper while the platforms continued operating exactly as before.
The question worth asking is not whether this policy is well-intentioned. It almost certainly is. The question is whether this time is different and what would need to be true for government regulation to actually work in a sector built on algorithmic pricing and global platform power.
The Economics That Created the Problem
To understand why regulation keeps being attempted, you need to understand the driver economics that have made the current situation unsustainable.
Kenya has approximately 35,000 drivers enrolled on ride-hailing platforms, most of them cross-listed across multiple apps. They collectively complete around 175,000 trips per day. The majority of these drivers did not buy their cars outright, they are servicing loans, often with monthly repayments between Ksh 30,000 and Ksh 50,000, on vehicles bought specifically for ride-hailing. On top of that: fuel at roughly Ksh 180 per litre, insurance, maintenance, county permits, NTSA compliance costs, and the basic cost of living.
The current minimum fare on most platforms is Ksh 180, a figure drivers say has not moved meaningfully while every one of their costs has risen. The Automobile Association of Kenya has recommended a minimum of Ksh 33 per kilometre to adequately cover vehicle maintenance costs alone. A driver completing a 5km trip at the minimum fare of Ksh 180 earns Ksh 162 after an 18% platform commission or as little as Ksh 135 if the platform is applying the 25% commission rate that was supposed to be capped four years ago.
Drivers have responded the only way they can, by refusing short trips, gaming the acceptance rate algorithms, charging passengers off-app for airport and highway runs, and organising periodic strikes that briefly get attention before the cycle repeats.
Meanwhile, the platforms compete for market share by running promotions and discounts that further compress per-trip earnings, while simultaneously maintaining or increasing driver commissions to fund those promotions. The driver absorbs the cost of the platform's customer acquisition strategy with no say in the matter.
This is the dynamic the National Taxi Policy is attempting to address. The goal is legitimate. The challenge is execution.
A History of Interventions That Did Not Stick
The current proposal is not Kenya's first attempt to regulate this space. It is closer to the fifth.
2020 — The NTSA Digital Hailing Regulations required all ride-hailing platforms to obtain transport network licences and capped commission at 15%. The regulations triggered immediate pushback from platforms arguing the process lacked proper public participation.
2022 — The 18% Commission Cap was gazetted with significant fanfare. Uber responded by taking the government to the Supreme Court, arguing the cap was unconstitutional, discriminatory, and damaging to foreign investment. In its court filing, Uber noted that the cap combined with proposed digital service taxes would have "a major impact on the petitioner's revenue from the Kenyan market." The case dragged on and enforcement never happened at scale, Uber continued operating at 25% commission well after the cap was supposed to take effect.
2023 — The Nairobi County Taxi Permit Regulations created a separate layer of county-level requirements that conflicted with national regulations, adding compliance costs without solving the core earnings problem.
November 2025 — The AAK Pricing Directive recommended the Ksh 33 per kilometre minimum, generating coverage and driver optimism. It was not binding on the platforms and nothing changed.
Now in 2026 we have the National Taxi Policy, broader in scope than any previous attempt, benchmarked against South Africa, the EU, the UK, and Singapore, and developed with World Bank support. The ministry says it will also cover boda bodas, tuk-tuks, and e-bicycles, making this the most comprehensive mobility regulation exercise Kenya has attempted.
The pattern of the previous four attempts is not comforting. But there are reasons to think this iteration may be different.
Why This Time Could Be Different
The Lagos precedent is fresh and visible. This week, Nigerian drivers in Lagos launched a three-day strike through the Amalgamated Union of App-Based Transporters of Nigeria, demanding higher fares and lower commissions from Uber, Bolt, and InDrive. The strike is being watched across Africa's ride-hailing markets and has put the question of platform economics on the continent's front pages in a way that individual country protests have not. Regional momentum matters in regulatory environments when multiple governments are moving in the same direction simultaneously, platforms have less leverage to threaten withdrawal.
The JKIA airport app signals government appetite. The Kenya Airports Authority is planning its own taxi-hailing platform at JKIA, allowing passengers to book licensed airport taxis through an app with GPS tracking and digital dispatch. This is directly competitive with Uber and Bolt on their most lucrative route segment. A government willing to build a competing platform is a government more serious about sector control than one that only passes regulations.
World Bank involvement changes the credibility calculus. Previous regulations were developed internally. This policy is being benchmarked against international models with World Bank support, which typically means a more rigorous cost-analysis process and external accountability on implementation. Regulations with external technical assistance are harder to dismiss as arbitrary.
The court option has limits. Uber successfully delayed the 18% commission cap through litigation. But litigation is expensive, takes years, and generates sustained negative publicity. Platforms that have fought every regulatory intervention in a market eventually face a political environment where governments stop accommodating them. Kenya is approaching that threshold.
The Passengers Question Nobody Is Answering
Every driver-focused argument for fare regulation has a mirror image: passengers will pay more.
This is not speculation. If the government's plan is fully implemented, it will mandate a shift in how ride-hailing firms structure their algorithms, and for millions of urban commuters who rely on services like Uber and Bolt, this change will likely translate to higher fares.
For a commuter doing two trips a day on a Ksh 180 minimum fare, the difference between that and a Ksh 300 minimum (the figure drivers have been advocating for ) is Ksh 240 per day, Ksh 1,200 per week, roughly Ksh 5,000 per month. That is not trivial for a salaried Nairobian.
The Ministry frames this as a necessary trade-off, sustainable driver earnings in exchange for somewhat higher fares. That argument is reasonable. But "somewhat higher fares" is doing a lot of work in a city where public transport alternatives are inadequate, where matatu routes do not cover most residential areas efficiently, and where the app-based taxi became dominant precisely because it was affordable in a way that traditional taxis were not.
The policy must grapple honestly with the passenger impact. Minimum viable fare calculations that only look at driver cost structures without modelling the demand elasticity (how many trips disappear when fares go up, and from which income segments) will produce a framework that fixes driver earnings in theory while shrinking the total market in practice. Fewer trips means lower driver earnings even at higher per-trip rates. That is the failure mode that Kenya's regulators need to design around.
What a Policy That Actually Works Would Look Like
Drawing from how the most successful fare regulation frameworks operate globally, a credible National Taxi Policy for Kenya needs several things that previous attempts have lacked.
A binding minimum, not a recommendation. The AA Kenya recommendation of Ksh 33 per kilometre did nothing because it was advisory. The policy needs legally enforceable minimums with penalties for platforms that undercut them, applied consistently, not selectively.
Transparent commission caps with real enforcement. The 18% cap has existed on paper since 2022. A new policy that repeats the cap without addressing why it was never enforced is meaningless. Enforcement requires a digital audit mechanism — KRA already has access to platform transaction data through the digital service tax framework. Using that data to verify commission rates is technically feasible.
A fare review mechanism. Fuel prices change. Inflation moves. A static minimum fare set in 2026 will be obsolete by 2028. The policy needs a structured annual or biannual review process tied to a transparent cost index ( fuel price, CPI, insurance costs ) so adjustments happen automatically rather than requiring a new political fight every time costs rise.
Driver representation in the process. Every previous regulation was designed by government and contested by platforms. Drivers (the people the regulation is supposed to protect) have been consulted intermittently at best. A policy developed with genuine driver input, including actual cost data from drivers across income levels and vehicle types, is more likely to set viable minimums than one based on desk research.
A passenger protection framework alongside driver protection. Fare increases without service quality improvements will not be politically sustainable. The policy should pair minimum fares with minimum service standards like driver rating floors, vehicle age limits, mandatory insurance verification, and complaint resolution mechanisms that actually function.
The Honest Assessment
Kenya's ride-hailing sector has a genuine problem. Drivers are earning unsustainable incomes on vehicles they are still paying for. The platforms that created this dynamic have shown no appetite to self-correct because the competitive pressure to acquire market share through low fares is more immediate than the long-term cost of driver attrition.
Government intervention is not inherently wrong here. The EU, UK, and Singapore (the benchmarks the ministry has cited) have all moved toward some form of fare floor or commission regulation for ride-hailing, with mixed but generally positive results for driver earnings without catastrophic passenger fare increases.
What is wrong is assuming that a well-written policy document solves the problem. Kenya has written good policy documents before. The 18% commission cap was well-written. It did not work because enforcement infrastructure did not exist and litigation was cheap for the platforms.
The National Taxi Policy will succeed if it is built around enforcement mechanisms rather than aspiration, if it uses the digital transaction data KRA already collects to verify compliance, if it includes escalating penalties for platforms that ignore it, and if it accepts that Uber and Bolt will litigate and builds a legal framework resilient enough to survive that litigation.
It will fail, like its predecessors, if it produces a gazette notice that platforms ignore until a court suspends it, at which point everyone moves on to the next policy cycle and the drivers go back to refusing short trips in Westlands.
The algorithm has set the price of a Nairobi taxi trip for a decade. Whether an Act can actually change that depends entirely on whether this government is willing to enforce what it writes.
Are you a ride-hailing driver or a regular commuter? We want to hear your take on what fair fares actually look like, share your view in the comments.
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