Smartphone-based taxi booking service, goCatch has entered an agreement to partner with retail, mobile, and online payments provider, Mint Payments, to capitalise on in-taxi card payments.
The partnership will begin with a Sydney-based pilot that will see a portion of goCatch's 35,000 registered drivers decked out with Mint Payments' mobile point-of-sale (mPos) terminals to "build out new revenue channels for both businesses", in an industry goCatch estimates to be worth AU$5.4 billion in Australia.
"Roughly half of all taxi jobs in Australia are hailed from the street or taxi rank, representing a big opportunity for goCatch to monetise payments for these journeys -- rolling out mobile payment terminals enables us to capture some of that revenue," goCatch CEO Ned Moorfield said.
"We believe that the combination of goCatch's bookings app and Mint's payments terminal will be far ahead of any competing offering in the market."
The pocket-sized mPos card reader uses the driver's smartphone or tablet as the Eftpos machine, and supports major cards, tap and go technology, and chip and pin-based debit and credit cards.
As yet, goCatch has not targeted in-taxi payments, but the company said as an incentive, its drivers will earn commission from fares processed via Mint Payment's mPos terminals, and will also be credited ten "goPoints" for every dollar they put through the terminal to increase their driver status, with "high status" drivers awarded first bids on lucrative jobs.
Although considered a direct competitor of goCatch, controversial ride-sharing app Uber has consistently reaffirmed it is not a taxi service, and as such, should not have to operate under existing taxi regulations.
Uber found itself in court last week with the Australian Taxation Office (ATO) arguing during the first directions of Uber B.V v The Commissioner of Taxation of the Commonwealth of Australia that UberX drivers do not fall within the same definition as taxi and limousine drivers, and therefore should be required to pay the Good and Services Tax (GST).
The ATO defined taxi travel as "travel that involves transporting passengers for fares", and in May demanded drivers of the ride-hailing app sign up for an Australian Business Number and pay GST by August 1. Although Uber told its drivers to abide by the ATO directive, the startup filed documents to the Federal Court a day before the August 1 deadline to contest.
Uber's Australia and New Zealand general manager David Rohrsheim believes the ATO has singled out UberX partners for "special treatment".
"Uber drivers are not providing taxi services. Full stop," Rohrsheim told ABC RN Breakfast in mid-August.
In July, the New South Wales government introduced an independent task force to examine the future of the state's taxi and ride-sharing industries. According to the government, it intends to work with customers, the taxi industry, hire car companies, and other stakeholders to examine the market's sustainability and competition, as well as the impact of emerging technologies, the importance of customer safety, and the burden of current taxi regulations.
Last month, the task force -- known as the Point to Point Transport Taskforce -- recognised changes need to be made to the current regulatory framework, which is mainly being governed within the Passenger Transport Act 1990.
In its discussion paper [PDF], the taskforce said the existing regulatory framework is "difficult to enforce", and therefore not as effective as it could be, concluding that it is consequently causing unnecessary burden for the taxi industry, including high costs; ultimately causing higher fares for customers, and making it difficult for them to compete with hire cars and other point to point transport providers.
Third-party and rival payment processors are now able to accept Cabcharge cards for the first time in the Australian taxi payments industry, after the Australian Competition and Consumer Commission (ACCC) accepted a court-enforceable undertaking from Cabcharge Australia in July this year.
Cabcharge agreed to a five-year period to negotiate with third parties in relation to providing access to the system that will allow them to process Cabcharge cards; execute an agreement with third parties who apply for access according to provisions set out in the undertaking; and provide third parties with technological support to enable them to process Cabcharge cards.
At the time, Ingogo -- long considered goCatch's rival -- said ahead of the company's looming initial public offering it was only Cabcharge's "nice way" to appease the ACCC.
"From the undertaking on ACCC website, the standard agreement is only offering 20c per transaction, which on an average fare of AU$34, it means Cabcharge is charging [the] equivalent of a 9.5 percent merchant service fee," Ingogo CEO Hamish Petrie said.
"Not only are they ripping off their customers, they are now proposing to rip off terminal providers."
According to the Australian Taxi Industry Association (ATIA) [PDF], in 2014, 227 million taxi trips were made Australia-wide, with 97 million of those in NSW alone. The ATIA also found the average taxi licence price in the state was AU$367,000, second in cost only to Queensland, at AU$519,000. The average taxi fair in Australia in 2014 was AU$23.97.