Business

Opay Shuts Down Ride-Hailing Services Over Economic Downturn

By Shola Adewunmi

Hours after donating 300,000 medical face masks to hospitals and healthcare centers to flatten coronavirus curve in Nigeria, OPay, an operator of ride-hailing services in the country, has shut down a major section of its business in Nigeria.
Opay said that services to be affected were ORide, OCar, and OExpress and that the decision to suspend its ride-hailing services was due to harsh business environment and the lockdown occasioned by the COVID-19.
With the decision to shut down major sections of its business in Nigeria, several riders and staff were expected to be laid off by the company to assist it to remain afloat in other sectors.
In a statement made available to newsmen on Thursday, the company stated that ride-sharing was only one of its diversified businesses in Nigeria, adding that it had been investing in the financial and technology sectors.
To remain relevant in Nigeria, the firm noted it was changing its business focus from rides to other promising areas like the eCommerce space which research has shown that it was the new trend globally.
“We can confirm that some of our business units, including the ride-hailing services, ORide, OCar, as well as our logistics service OExpress, will be put on pause. This is largely due to the harsh business conditions which have affected many Nigerian companies, including ours, during this COVID-19 pandemic, the lockdown, and government ban.
“Globally, ride-sharing businesses have been heavily impacted by the pandemic. But several months ago, foreseeing this issue, OPay had already taken preemptive steps to restructure our business focus away from rides. It is worthy to note that this final restructuring has minimal impact on OPay as a whole business.
“During the pandemic, we have seen continued demand for our offline mobile money agency, and online digital payment, which remains the core of our business.
“From January to April 2020, for example, we witnessed a 44 percent growth on offline and online transaction value even in the midst of the pandemic and lockdown. This is a testament to the high demand for flexible and easy financial services by Nigerians. Opay remains one of the most well-funded and profitable mobile money platforms in Nigeria, and we will continue to do more for our customers,” the statement added.

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