Your next digital taxi ride will cost more, new AAK rates explained

Kenyans using digital taxi apps should expect higher fares in the coming days after the government directed ride-hailing companies to immediately adopt new pricing standards.

The move, though welcomed by drivers, is set to spark mixed reactions among passengers already squeezed by the rising cost of living.

For a long time, digital taxi drivers have argued that the fares set by app companies are too low to sustain their livelihoods.

This week, the Ministry of Transport finally intervened, directing app owners to implement the pricing recommendations issued by the Automobile Association of Kenya (AAK) in 2023.

Speaking on behalf of Transport Cabinet Secretary Davis Chirchir, Director for Road and Railways Transport Paul King’ori told drivers that enforcement would begin immediately.

“The first directive is that app owners must use the AAK rates. We have also communicated with the World Bank to engage a consultancy to help draft the National Taxi Pricing Policy as a long-term strategy to improve the sector. Let us be patient.”

It’s a victory for drivers, but it simultaneously raises concerns about affordability for many Kenyans who rely on ride-hailing for transport.

What the new rates look like

Under the revised AAK-aligned structure:

• Vehicles with engines up to 1050cc will now earn Sh33.1 per kilometre, up from Sh22.

• Cars with engines between 1051cc and 1300cc will receive Sh36.8 per kilometre, up from Sh26.

This represents an almost 50 per cent increase. It’s a significant jump, and arguably overdue, but the timing may feel harsh for consumers.

App companies have been given seven days to confirm compliance.

King’ori emphasised this in a letter read out to the drivers:
“You (digital taxi app owners) should provide a formal response to this office within seven days outlining the steps you have taken to address these legitimate grievances.”

He added that the one-week deadline was necessary because the companies are global and must consult widely before making adjustments.

NTSA Head of Licensing for Transport Network Companies, Yahya Ahmed, assured drivers that their concerns were finally being taken seriously.

How this will affect passengers

While this directive is transformational for drivers, it also means passengers will soon feel the pinch. Apps typically pass increased operational costs directly to riders and rarely in small increments.

For commuters already facing rising matatu fares, fuel costs, and general inflation, a 50 per cent surge in taxi rates could make ride-hailing less accessible.