We are going cashless, but why? | Aron Gatt

Aron Gatt is President Light Passenger Operators Association (LPOA)

The government’s recent proposal to phase out cash payments in the cab sector has been presented to the public as a bold solution to some of the industry’s deepest problems. The message being put forward is simple: Cash fuels undeclared income, cash sustains the exploitative 50/50 model, and cash puts drivers at risk of robbery. Remove cash, the argument goes, and the industry will become safer, fairer, and more transparent. It is an appealing narrative.

But while LPOA supports modernisation and meaningful reform, we have strong doubts as to whether this particular proposal will achieve any of its stated aims. By focusing on cash as the villain, government risks confusing symptoms with causes and, in the process, distracting attention from the real reforms that are urgently needed.

Consider the issue of safety. We have heard news reports of drivers robbed at knife point, on our roads. Yet to suggest that banning cash will make drivers safe is misleading. A criminal intent on harming or intimidating a driver is not deterred by whether the fare is paid in cash or by card. If we were to apply this reasoning for safety, we should abolish cash across the board, and no one should be allowed to use it in restaurants and everywhere else. Violence against drivers cannot be solved through a payment method. Real safety comes from reforms that change the way platforms and operators function.

Drivers should be told the destination of a trip before they accept it, giving them the chance to assess whether it is safe. Passengers should be required to verify their identity, just as drivers already must. Emergency buttons that connect drivers directly to the police and send their location in real time should be standard. Operators should have the authority to suspend suspicious passenger accounts immediately. These are the measures that offer genuine protection. The absence of cash in a driver’s wallet does not.

It must also be said outright that the notion that abolishing cash payments reduces abuse or helps prevent tax evasion is false and misleading. A trip, whether cashless or not, is always recorded on the platform irrespective of how it is paid. The transaction is logged and traceable in exactly the same way.

In fact, it has already been reported in the media that the authorities have access to all rides, and therefore, once a ride is registered, whether paid in cash or by card, the government already has full means to oversee the flow of funds. To suggest that cash payments somehow enable tax evasion or money laundering is not only untrue, it is a deliberate distortion of the facts.

Outlaw 50/50 model

The same flawed reasoning applies to the claim that a cashless system will eliminate the 50/50 model. The 50/50 arrangement is not sustained by the presence of cash. It is sustained by the structure of contracts and the way operators engage drivers.

Unless government acts directly to outlaw this practice, and unless it ensures that drivers are employed with transparent contracts that guarantee a base wage and fair conditions, 50/50 will continue. The method of payment has no bearing on its existence.

Recent reporting by MaltaToday has revealed the extent to which abuse operates outside the realm of cash altogether. Drivers formally employed on minimum wage are in reality receiving around four €4,000 a month through a patchwork of allowances and adjustments. This is not a case of drivers pocketing undeclared cash payments. It is a case of companies structuring payslips in ways that disguise true income and raise serious questions about taxation and social security contributions. A ban on cash does nothing to address this problem. What is needed is regulatory oversight that goes beyond superficial appearances and examines how drivers are actually contracted and paid.

Meanwhile, Malta is still a cash-preferring economy by EU standards. The European Central Bank has warned against blanket “no-cash” approaches that risk excluding people and undermining the legal-tender framework. Public policy should avoid creating a payments-hurdle to access a basic mobility service.

So, let’s fix what’s broken. LPOA supports modernisation, but it must target the mechanics of abuse, not the medium of payment.

It seems this measure is set to be adopted in the ride-hailing sector, but what about the rest of the industry? Will scheduled rides, chauffeur services, and other forms of passenger transport also be forced to go cashless? If cash is truly being banned on the basis of safety or transparency, then logic demands that it should be banned everywhere in transport, without exception. Yet no such measures are being proposed in other sectors.

This selective targeting exposes the measure for what it really is—not a genuine safety or anti-abuse reform, but a disproportionate and discriminatory policy aimed only

at ride-hailing drivers.

A matter of choice

At its heart, this issue must boil down to choice. Operators are not children to be dictated to; they are professionals, and they should have the right to decide whether to accept cash, card, or both. For some, cashless payments may well provide convenience and security. But for many others, especially in a country where cash is still the dominant method of payment, being forced to refuse cash is the same as being forced to refuse customers. It is not for government to strip operators of this freedom under the guise of reform. A genuinely fair policy would respect operators enough to let them choose how they are paid. The simplest and most effective solution would be to make this a toggle option within the operator’s application, empowering each operator to decide for themselves.

Anything less is not modernisation; it is control dressed up as progress. Reform should empower operators with more options, not handcuff them with fewer.

If the government’s aim is truly to reform the sector, it must direct its efforts towards the root causes of exploitation and danger rather than symbolic fixes. That means banning the 50/50 model outright, not hoping it disappears indirectly. It means introducing strict rules on allowances and adjustments so that payslips reflect real income, not creative accounting. It means equipping regulators with the tools to enforce working-time limits and prevent drivers from being forced into 16- or 18-hour shifts. And it means placing real, technology-driven safety protections into the apps drivers rely on, rather than leaving them exposed on the promise that cashless payments will somehow keep them safe.

The Light Passenger Operators Association is in favour of reforms that genuinely improve the industry for both drivers and passengers. But modernisation must not be confused with distraction. Banning cash is a superficial solution to deep problems. Malta’s cab sector needs courage to tackle the structural issues head on.

Until that happens, the challenges that plague our industry will remain, no matter how many cashless terminals are installed in our vehicles.