The newly launched digital payment system for public transport in Nairobi is a fraud according to the Consumer Federation of Kenya (Cofek).

President Uhuru Kenyatta and the private transport stakeholders, last week launched the My1963 card that will use the near field technology to implement the long awaited cashless transport payment system in Kenya.

The transport ministry hopes to digitize the payments in all public transport vehicles, to improve efficiency and to regulate the transport industry. Now, Cofek, which has previously fought against the broadcast digitization process and the impending national digital register, has weighed in on the matter.

The body says the consumer has not been well informed about the use of the digital payment system and is out to benefit "all except the consumer".

"The move is against the National Values at Article 10 and denies public-interest information as legitimately expected under Article 35," the federation said. In addition, they claim that there is nowhere in the constitution that would compel any entity to go fully cashless.

"There has been little transparency on the move to over-burden taxpayers and consumers with unreasonable transaction fees of 3% of the gross collections from the over 80,000 PSV's making an average Sh20,000 per day gross daily gross income," the body added.

"From modest figures, of say 50,000 PSV's, an exorbitant 3% commission agreed between the NTSA's [National Transport Safety Authority] technology provider and the banks will run into billions at the expense of the consumer."

Furthermore the body alleges that there might be vested interest in the launch of the card that was not done in a competitive manner. The body mentioned State House ICT Director Dennis Itumbi, Nairobi Senator Mike Mbuvi and Simon Kimutai of the Matatu Owners Association as people with personal vested interest in the project.

Cofek wants the process halted and have the Competition Authority of Kenya (CAK); the Ethics and Anti-Corruption Commission (EACC) and the Public Procurement Oversight Authority (PPOA) investigate the awarding process.

Cofek warns that if nothing is done to address its fears, then they will challenge the process in court.