Colombian fintech Tpaga teams up with taxi company to facilitate e-wallet services

Contxto – Riding a taxi in Colombia may be seen by some as an obsolete means of transportation when there are so many slick ride-hailing apps out there. Nonetheless, startups may provide cab drivers a way back into the game, as recently shown with Colombian fintech, Tpaga, partnering up with taxi company, Taxia Life, to procure electronic payments via e-wallet.

Taxi troubles and alliances

As fintechs and electronic payments rise, taxis are falling into turmoil and the statistics prove it.

In Colombia, less than five percent of the 800,000 taxi drivers in the country accept payments via credit card or electronic transfer, according to one study. The lack of a payment terminal and/or bank account is the primary cause.

This exhibits the importance of Tpaga and Taxia Life joining forces. Through this startup’s transfer service, taxi drivers under Taxia Life can receive electronic payments from passengers. On Tpaga’s app, funds are wired to a cabby’s e-wallet. Money on the platform can also be used for tasks like paying for public services.

Digitizing in the era of Uber

Although some cab companies in Colombia are determined to stay relevant in the digital era through their own means. 

For example, what might distinguish Taxia Life from other private transportation firms is the fact that it is more inclined towards tech. With Taxia Life, users can request a taxi using various social media apps like WhatsApp and Facebook Messenger. Not to mention the fact that this company already has its own app.

Related article: Colombian ride-hailing Digi+ leapfrogs regulation by working with cab drivers

Tpaga, the dark horse?

If there’s a startup worth keeping an eye on, it’s Tpaga. Even if it’s not the fintech with the largest user base using its mobile wallet. That title belongs to Daviplata, a spin-off from a traditional Colombian bank, Davivienda. In second place is the challenger bank, Nequi according to a recent survey.

However, according to that same report’s findings, Tpaga is one of the fastest-growing contenders among the unbanked population. Likewise, this fintech is also filling in gaps where other startups struggle. One recent case is Chilean Buda.com partnering with Tpaga to provide cryptotrade in Colombia.

Up the ante

Traditional banks are dashing to digitize to try and continue being attractive in the face of neobanks. Likewise, taxis in Colombia understand that the popularity of apps like Uber and Cabify is due to their ease of use.

However, there’s still no regulation for apps like Uber and Cabify on the horizon. This might suggest that the secret to ride-hailing startups operating legally in Colombia is through befriending taxi companies. 

Talk about a tough crowd.

-ML