The Lagos State Government has signed a Memorandum of Understanding (MoU) with the Nigeria Union of Road Transport Workers (NURTW) and the Road Transport Employers Association of Nigeria (RTEAN) to gradually phase out cash payments on danfo buses in favour of a fully digital fare system. The agreement, signed on Wednesday, marks a significant step towards formalising the state's informal transport sector, aiming to enhance transparency and curb revenue leakages.
Key Details of the Agreement
Under the new plan, cash payments to conductors will be replaced by a digital payment system, though no exact date has been announced for the full transition. The government says the move is designed to make fares more transparent, reduce revenue leakages, and simplify how passengers pay for their trips. The agreement is part of the broader Lagos State Bus Industry Transition Programme, implemented by the Lagos Metropolitan Area Transport Authority (LAMATA), which seeks to integrate danfo operators into a more organised transport network without displacing them.
Government and Union Perspectives
Speaking at the signing ceremony, the Permanent Secretary of the Lagos State Ministry of Transportation, Olawale Musa, described the agreement as "a new beginning for public transport in Lagos State," reflecting a shared commitment to reshape urban mobility. LAMATA's Managing Director, Abimbola Akinajo, revealed that the deal followed more than two years of negotiations, calling it "a verifiable example of a handshake between government and the unions." She emphasised that formalisation should not be seen as strangulation, but as a partnership to ensure transport workers benefit from the reforms.
Franchise System and Initial Routes
Beyond the digital fare shift, the agreement introduces a franchise-based system for danfo operators, starting with four routes currently under construction: Iju-Ishaga-Abule Egba, Ketu-Alapere-Akanimodo, Iyana-Iba-Igando-Iyana-Ipaja, and Ojuelegba-Lawanson-Cele. Under this system, operators will gradually move from informal, individually run routes to a more standardised structure, while remaining under union management. The unions' leadership, including RTEAN's Lagos State Chairman Samson Adepeju and NURTW's state Chairman Mustapha Adekunle, signed on behalf of their members.
Impact on Commuters
For now, danfo commuters will continue to use cash as the transition begins, with digital payments expected to roll out gradually alongside the new franchise routes. The move is expected to improve fare transparency and reduce revenue leakages, ultimately benefiting both passengers and operators. The agreement underscores the government's commitment to modernising public transport while ensuring that transport workers become partners in the reform process.
