The passenger service vehicle psv sector has always been a lucrative industry to invest in. Published 2004 by institute of policy analysis and research in nairobi, kenya. Matatu business is profitable and can make you a millionaire, but you must have solid management skills to penetrate the sophisticated industry. Matatus are the informal paratransit industry in kenya that provide service to millions of people a day and are essentially the backbone of the transportation system in nairobi. Matatuculture is known globally, and its one of those things kenyans are proud of. The organization, issues and the future role of the matatu industry. Cooperatives of matatu industry sector in nakuru county, kenya king angi ruth murugi and ngahu solomon thuo school of business, jomo kenyatta university of agriculture and technology abstract the study examined cash management as one of the determinants of financial sustainability of saccos in the matatu industry in nakuru county, kenya. Although their origins can be traced back to the 1960s, matatu saw growth in kenya in the 1980s and 1990s, and by the early 2000s the archetypal form was a gaily decorated japanese microvan. Matatus are the informal paratransit industry in kenya that provide service to millions of people a day and are essentially the backbone. The minimum amount of initial capital you can expect to inject to get your matatu on the road is ksh500,000 assuming you buy an old van which has been used locally for several years. The impact of monitoring technologies on contracts and employee behavior. Regulation is important for any sector since uncontrolled market place cannot produce behaviour or results in accordance with.
Aug 24, 2017 matatuculture is known globally, and its one of those things kenyans are proud of. Pdf improving tax compliance in the informal sector. This paper is an analysis of the matatu industry and offers a discussion of how its structure and networks may pose obstacles but also opportunities for transport reform in the capital city of nairobi, located in kenya. I was in a matatu bussines 3 years a go a long narok bomet kericho nakuru. The fall of kbs made it possible to run matatu business in kenya in a time where minivans were the preferred mode of transport. Regulations in the public transport industry in kenya are in the form of laws and bylaws. An investigation of the factors influencing the perfomance of. Matatu industry in kenya a study of the performance of owners, workers, and their associations and potential for improvement by orieko chitere. Contributors brighton amwayi a communications graduate with a wealth of experience in the field. Challenges affecting investment in public transport matatu industry in nairobi kenya oira, a. Oct 08, 20 the technology modernising kenya s matatus. A significant amount of literature identified matatu drivers specifically as being dangerous drivers, or the main cause of accidents. Experimental evidence from kenyas matatu industry erin m. Acquiring a matatu for the business requires a minimum initial capital of 500,000ksh.
After kenyas independence in 1963, africans migrated to nairobi seeking employment opportunities. The government seeks to protect its citizens from harassment, exploitation and. Registered matatu sacco in kenya in 2020 ekopa mag. Each route has the main sacco which, as mandated by the transport licensing board is responsible for managing the affairs of the. However, the unregulated nature of the matatu industry coupled with gangs and cartels who extorted matatu owners and made it hard for most people to survive in the industry. Effect of financial management practices on profitability of.
This study was guided by three theories of strategic management these are the resource based. Jan 20, 2020 matatu culture is a system where the matatus are often decorated in graffiti art featuring portraits of famous people or slogans and sayings. He is passionate about strategic and development communication and has previously worked with the kenya institute of curriculum development and the kenya news agency. A large and growing informal economy is an issue of concern for many developing countries. The objectives of this study were to establish the effect of competitive strategies on the performance of the public service vehicles sector within the transport industry in kenya. Livelihood, conditions of work, regulation and road safety in. A unique feature in kenyas transport sector has been the rapid expansion of the matatu, a small scale means of transport. Truth be said, the matatu industry employs hundred of thousand if not millions of jobs in kenya but both the national and county governments gets a meager fraction of the taxes and rates they deserve. Ultimately, this initiative failed due to complicated power structures that exist around the public transport system in kenya. Formalising the matatu industry in kenya uon repository. Every matatu driver has been in jail at least once, says james kariuki, a 20year veteran of the industry. The impact of monitoring technologies on contracts and.
These matatus are the only reliable form of public transportation and. Kenya that provide service to millions of people a day. The industry is dominated by thousands of smallscale entrepreneurs that own a few minibuses matatus that run on designated routes. July 31, 2018 abstract asymmetric information makes designing contracts challenging. Matatu business in kenya falls under the public transport industry. This working paper is an analysis of the matatu industry s operations and offers a discussion of how its structure and networks may pose obstacles but also opportunities for transport reform in nairobi, kenya. A kenyan policeman boards a matatu after the vehicle was stopped for a traffic offense. The government seeks to protect its citizens from harassment, exploitation and mistreatment associated with the matatu industry.
But matatu business is lucrative to those who are willing to take the risk and venture into the business. By facilitating a broader policy dialogue involving key stakeholders in the industry and the inclusion of the matatu industry in the reform. The government of kenya has come up with various laws and regulations for the public transport sector. Commonly asked questions about investing in the matatu industry. Section 42 1 and 3 of the 1975 traffic act specified speed limits for psv vehicles, while. Dec 15, 2012 i was in a matatu bussines 3 years a go a long narok bomet kericho nakuru. On using cars that use less gas, thats for the matatu investors to make the switch and increase on the profits.
This is money one can use to buy a second hand matatu that has been on the road for 68 years. Registered matatu sacco in kenya is an article that will look at the some of the saccos which have been approved by ntsa. The astronomical growth of the public service vehicles, particularly that of the matatu transport cooperatives has created challenges of overcrowding in literally all towns in kenya. Some of its key provisions, such as speed limits and seatbelts, were not new. The matatu sector in kenya has undergone immense transformation, from the unregulated, chaotic 1990s to a more client focused and fairly safe industry. Stratified sampling method was used to draw samples from the selected active matatu saccos registered in thika west district by the ministry of cooperative development and marketing. The matatu owners employed strategies that can usefully be. The origins of matatu industry can be traced from the type of transport system that operated in towns in the early 1960s. The public transport matatus in kenya makes a significant part. In kenyas capital city, nairobi, streets are regularly gridlocked. Unfortunately, the sector has largely operated with minimal regulations. What you need to know about matatu business in kenya.
Among the latest directives aimed at streamlining the matatu industry was cashless transactions to enable taxation and regulate fares that keep fluctuating. Matatu culture photos why we are the best urban kenyans. Matatu business is not hard to start as long as you have money to buy a matatu, pay for insurance, psv license and obey the michuki rules. It may not be wise to venture into it if you are tied up in an office job from 8 am to 5 pm. Incorporating an array of ethnographic, documentary and archival sources, mutongi vividly illustrates how matatus, those raucous, crowded, colorful van taxis that ply the citys thoroughfares, are not merely an indispensable means of transport for the wanainchi everyday kenyans, but also. This study focused on matatus in saccos that ply three routes in nairobi namely mombasa road. Jul 20, 2017 matatu business is not hard to start as long as you have money to buy a matatu, pay for insurance, psv license and obey the michuki rules. If there is a sector in kenya that mints billions of shillings everyday but goes unregulated is the matatu industry in kenya psv.
A history of popular transportation in nairobi, mutongi. The passionate tout says colleagues in the industry noticed her determination and advised her to invest in the matatu sector. Matatus are the informal paratransit industry in kenya that provide service to millions of people a day and are essentially the backbone of the transportation system. Explore listings for matatu for sale in kenya at best prices. Jul 03, 2018 the matatu industry has undergone immense transformation from the unregulated,chaotic 1990s to a more client focused and fairly safe industry. One man is on a quest to document nairobis matatu culture before it disappears. The kenyan law require all the psv operators including the matatus to be member of a sacco or psv company before applying for a psv license. The matatu industry is part of the kenya private sector economy. This study was guided by three theories of strategic management these are the resource based theory, competitive advantage theory and agency theory. This paper examines the struggle for livelihood in the matatu industry and the resultant problems of conditions of work, regulation and road safety. As i was searching trough the web i came a cross your information. Matatu industry in kenya 2004 edition open library.
The organization and future of the matatu industry in nairobi, kenya. Challenges affecting investment in public transport matatu industry in nairobikenya oira, a. Some of the owners also held positions in government that would make them partisan when making decisions on the matatu industry. Hence the study is aimed at assessing the effect of cost of capital and capital structure on the profitability of matatu industry in kenya public transport in kenya and especially in urban areas is dominated by matatu vehicles. The organization and future of the matatu industry in nairobi. Public transport is mainly provided informally by private operators in major cities in africa. It is estimated that there are more than half a million psv matatus that ply our roads every day. The matatu, a smallscale public transport vehicle in kenya, is vital in both rural and urban areas for the movement of people and goods. Aug 22, 2017 a kenyan policeman boards a matatu after the vehicle was stopped for a traffic offense. Matatu routes that have been licensed by the transport licensing board tlb among them. Paper prepared on ipar policy brief on the matatu industry in kenya. But the real problem comes the vehicle hits the road.
Institutions and business strategies of matatu operators. How graffiti artists are driving the matatu industry in. Kenya bus though the operation of matatus remained. It also involves pimping the matatu with modern digital display gadgets and of course the music they play is also aimed at quickly attracting riders. Regulation is important for any sector since uncontrolled market place cannot produce behaviour or results in accordance with the public interest.
Mutongi has written a lively, meticulously researched history of the matatu industry in nairobi. But matatu culture may soon be under threat from government bans and alternative forms of public transport. How to tame the rogue matatu industry in kenya and create. May 03, 2020 registered matatu sacco in kenya is an article that will look at the some of the saccos which have been approved by ntsa. The organization and future of the matatu industry in. Mordernization of matatu industry in kenya youtube. The friends linked me with sellers of second hand matatus, says wanjiru and adds that in september 2014 she purchased her first matatu at sh270,000. The technology modernising kenyas matatus bbc news. Efforts to improve road safety in kenya achievements and limitations of reforms in the matatu industry.
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