The Communications Authority of Kenya (CA) has proposed to introduce a new licence for courier-hailing firms that will see them pay Sh100,000 for permits as the government seeks to grow revenues from the fast-growing market for home and office deliveries.
The proposal by CA will also see the online-based delivery service firms such as Glovo, Uber and Little pay at least Sh100,000 or 0.4 percent of their annual gross turnover or whichever is higher in annual operating fees.
Additionally, they will pay a universal service levy that will be charged at 0.5 percent of their gross annual turnover of audited accounts.
Kenya has, over the years, witnessed a growing number of firms angling for the delivery of goods amid a growing consumer spending power, desire for convenience and comfort as buyers opt for office or home deliveries, a growth that the State wants to exploit and broaden revenue collection.
“The revised market structure presents the following amendments: introduction of a courier-hailing service provider licence targeting companies that leverage technology to manage courier services by linking customers with collection and delivery service providers,” CA says in the review of the postal and courier market structure, 2025.
A licence for courier-hailing services will be the fourth to be offered in Kenya. Currently, the government, through the CA, grants three types of licences in the courier sector. These are public postal operators, international postal courier operators and national postal courier operators.
The new licence is one of the proposals by the CA in a wider review of the local courier services, as the government seeks to change laws governing the sector and grow tax collections from firms leveraging technology.
CA says the current laws governing the sector, which have been in force since 2008, do not provide for new technology-driven business models such as courier-hailing service providers, platforms and motorcycle riders.
Most of the courier-hailing firms have partnered with leading retailers to deliver goods and food items to the homes and offices of buyers.
Most of the courier hailing firms have partnered with leading retailers to deliver goods and food items to the homes and offices of buyers. For example, Uber Eats inked a deal with Carrefour to make door-to-door deliveries from July this year.
As of June last year, there were 289 licensed courier service firms in Kenya. These include the State-owned Postal Corporation of Kenya (PCK).
Most of these are, however, not operational with CA saying that some of the couriers applied for licences without first assessing the market.
The firms, which are tapping on the deep internet penetration in Kenya, have taken over a market that was for years dominated by firms such as PCK and Securicor.
CA says that individual riders offering services under the hailing service provider network will ride on the licence paid for by the respective firm. The licence will be valid for 10 years.
