The Nairobi County government is losing tens of millions of shillings in revenue collection after a new electronic payments system experienced outages for the second day running.
City Hall collects about Sh10 billion in parking fees, business permits, land rates, rent, adverts, construction approval fees and other bills; translating into an average revenue of about Sh33 million per day for 300 working days in a year. Some of the fees are paid in cash directly into City Hall’s bank accounts or at its own banking halls.
Most motorists Tuesday parked for free just like they did on Monday, after the newly introduced revenue collection system experienced outages for the second day.
County Director of Parking Tom Tinega admitted the system was not fully functional.
The county government collects about Sh2 billion every year in parking fees alone.
Motorists were unable to pay for parking through the mobile phone-based *235# Unstructured Supplementary Service Data (USSD) system, which returned error results before completing transactions.
City Hall introduced the new internal system to collect levies and fees on Monday following the expiry of its five-year contract with electronic payment firm, JamboPay, in what it said would save millions of shillings paid as commissions to JamboPay for automating the revenue streams.
“The system is not fully functioning. Yes people are parking for free, there is no doubt, there are configuration issues. We expect to resolve them by end of the week,” he said yesterday.
The huge losses to City Hall come even as it emerged that motorists were to incur Sh25 extra costs to pay for parking, up from the Sh200 gazetted last December. Under the new system, Sh23 is incurred for every M-Pesa transaction, while Sh2 is deducted as service charge by City Hall.
Mr Tinega, however, ruled out a return to the e-Jijipay platform owned by JamboPay.
“JamboPay is forgotten and we cannot go back there. We would rather revert to the manual system,” Mr Tinega said.
The new account is registered with the National Bank of Kenya after City Hall dropped Co-operative Bank, which it used in the JamboPay deal.
The parking attendants said they were only clamping cars for double parking or parking along yellow lines, letting thousands of motorists to park for free due to the system hitch.
The county is also losing substantial amounts in towing and impounding fees that are collected daily. Nairobi has so far rolled out 500 smart devices to be used by the inspectorate and parking attendants to identify motorists who have complied and those who have not paid the Sh225 for daily parking.
The two-day losses will further hit Nairobi’s collections from parking fees in the year ending this month and the overall revenues after an earlier go-slow by county staff saw motorists park for free for 10 days.
City Hall’s collections suffered a hit during the go-slow occasioned by failure to honour a 15 percent pay rise deal signed with the staff in 2017.
Acting County Secretary Pauline Kahiga said that the county lost Sh650 million in the 10-day strike, raising the possibility that this may be the county’s worst year in revenue collections since the beginning of the devolved system of government in 2013.
The Governor Mike Sonko-led administration had targeted to have collected Sh9.6 billion in the year to June.