• Lagos has shut its economy against Okada and Tricycle operators including the bike hailing startups
  • Operators want the government to relax the Okada ban and regulate the sector
  • Business Insider SSA looks at the biggest losers and gainers from the Okada ban

The Lagos government has shut its economy against the bike ride-hailing startups in an infamous Okada ban policy.

Last week, the state government banned commercial motorcyclists known as Okada, and tricycles (Keke) in some major part of the state's metropolis.

“The figures are scary. From 2016 to 2019, there were over 10,000 accidents recorded at the General Hospitals alone. This number excludes unreported cases and those recorded by other hospitals. The total number of deaths from reported cases is over 600 as of date.

“The rate of crimes aided by Motorcycles (Okada) and Tricycles (Keke) keeps rising. Motorcycles (Okada) and Tricycles (Keke) are also used as getaway means by criminals,” a statement from the government read.

Operators want the government to relax the Okada ban

Bike hailing startups said their bikes are above the 200 cubic centimeter engine size required by the law as an exemption to the ban. They also believed the recent ban is blanket - without due clarity for both the informal and formal operators in the two-wheel mobility sector. They are calling for a regulatory framework rather than an outright ban on their operations.

Babajide Sanwo-Olu's government has countered some of the arguments, saying the law was not made for commercial riders.

Since enforcement started on Saturday, February 1, 2020, the Lagos State Police Command said it has arrested more than 40 violators and sized number of Motorcycles and Tricycles, mostly from the informal side. The ban has also caused many public outcry and chaos in some parts of the state.

We look at the biggest winners and losers from this ban:

Losers

  • Lagos residents

Arguably, the biggest losers in this debacle are the residents of the state on both ends.

The bike/Keke riders

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AFP

On the side of the riders, it is a job loss and a return to the street.

Commuters

It is also going to add to the usual traffic logjams on the road by compounding difficulties faced while Lagosians navigate through the cities.

  • Investors

Various investors that have tapped into the mobility sector in one of Africa's most populated cities will start counting their losses as the enforcement of Okada ban entered Day 3.

In the last one year, the likes of ORide through OPay, its parent company, Max Ng, Gokada, and others have raised more than $100 million to scale operations in Lagos and across Nigeria.

In a recent interview with The PUNCH, Adetayo Bamiduro, co-founder of MAX (Metro Africa Xpress), said the firm had invested close to $10 million (about N3.6bn).

Like Max Ng, investors have pumped more than $5 million funding in Gokada and $40 million investment funding Opera's ORide.

  • Business owner - Tricycles and Okada dealers

Businesses especially those dealing with Tricycles and Okada (Motorcycles) will suffer a huge impact as sales will drop.

  • Tech startups

Nigeria is one of the top gunners for Africa’s growing tech industry, with investors betting billions of dollars on the continent’s population powerhouse.

ORide bikes in Lagos
ORide bikes in Lagos

This approach has given birth to many startups. The new government’s ban on motorcycles and tricycles may reduce investors’ confidence in the country.

It may also force a few of them to shut down businesses.

Winners

  • Ride-sharing services 

More rides for Uber, Bolt, BRT, and other ride-hailing services such as OBus and PlentyWaka.

  • Lagos state government 

Lagos state government may now want to face its ‘megacity plan’ by providing alternatives and enabling environments for businesses to thrive. Lagosians will also be waiting to see various changes in the transportation sector.

Lagos Mini-shuttle bus running on Ajose Adeogun road Victoria Island (Pulse Nigeria)
Lagos Mini-shuttle bus running on Ajose Adeogun road Victoria Island (Pulse Nigeria)
  • Public Transport - Danfo drivers and Mini Shuttles

Danfo Bus (Popular Yello Lagos Bus) and Mini Shuttle Bus (Korope) are already capitalising on the ban for maximum returns. Some of them have inflated transport fares and embark on multiple trips every day.