In 2019, a Chinese-backed startup put QR codes inside Lagos danfos and was processing nearly 10,000 transactions a day. Less than a year later, it was collapsing. Its failure offers a warning for Lagos State as government now attempts to do what GONA could not: bring the unions themselves into a cashless transport system.
There is a revealing contradiction at the heart of Lagos's latest attempt to digitise public transportation.
In August 2026, the Lagos State Government, the Lagos Metropolitan Area Transport Authority (LAMATA), the National Union of Road Transport Workers (NURTW) and the Road Transport Employers Association of Nigeria (RTEAN) signed an agreement to transition informal bus operators into a regulated system under the Bus Industry Transition Programme (BITP).
The government describes it as a historic step towards a safer, more efficient and modern public transport system. The programme envisages franchise operators, regulated routes and fully digital fare collection.
But Lagos has been here before.
Seven years ago, a Chinese-backed startup called GONA attempted almost exactly the same thing from the private sector.
It put QR codes inside danfos. Passengers downloaded an app, funded a wallet and scanned codes to pay their fares. At its peak in 2019, GONA said it had thousands of active users and was processing nearly 10,000 transactions every day.
The technology worked.
The passengers were there.
The investors were there.
What GONA could not overcome was the political economy surrounding the danfo.
And according to an investigation published by Techpoint Africa on September 7, 2026, the company ultimately spent millions of naira attempting to buy the cooperation of transport unions — essentially paying in cash to build a cashless transport system.
That is the part of GONA's story Lagos should study most carefully.
Because the biggest obstacle to cashless danfos was never the QR code.
It was the cash.
GONA saw the problem before Lagos State was ready to solve it
Lagos's danfo system has always had an obvious weakness: almost everything happens in cash.
A passenger boards a bus. The conductor announces the fare. The passenger produces money. The conductor may not have change. The passenger may have to find smaller denominations.
The Yoruba expression “kò sí change” became almost synonymous with the experience.
GONA saw an opportunity in that inefficiency.
Its model was straightforward. Passengers could download the GONA application, fund their digital wallet and scan a QR code placed inside the bus. The fare was deducted electronically and the driver received confirmation.
In its early pilot, GONA operated along the Yaba–University of Lagos corridor, where the company found an unusually favourable environment for experimentation.
UNILAG provided a concentrated population of young, smartphone-owning passengers.
The startup could test the technology without immediately confronting the full complexity of Lagos's informal transport network.
And initially, it worked.
GONA expanded from the UNILAG environment towards Bariga and began using promotions and student ambassadors to encourage adoption.
By August 2019, the company had attracted a multi-million-dollar pre-Series A investment from Chinese investors including Crystal Stream Capital, UnityVC and Shaka VC. GONA said it was processing almost 10,000 transactions daily.
On paper, this looked like a classic African fintech success story.
But transportation is not simply a technology market.
It is also a political market.
The problem started when GONA left the university
The UNILAG experiment offered something the wider Lagos transport system did not: order.
Passengers queued.
Drivers had a defined environment.
The startup could control more of the passenger experience.
Outside the campus, GONA encountered a completely different ecosystem.
According to Techpoint Africa's investigation, the startup's attempt to introduce its own premium buses along the Obalende–Victoria Island corridor brought it into conflict with transport-union interests.
The company eventually abandoned the hired Toyota HiAce model and tried something more politically difficult but strategically logical: work with the existing danfo system instead of trying to replace it.
GONA trained drivers.
It bought smartphones for some drivers who did not have them.
It put agents on buses.
And it allowed passengers to pay digitally.
But the problem was that the digital transaction did not necessarily fit the driver's daily reality.
Some drivers struggled with electronic accounting. Others reportedly demanded cash even after passengers had paid digitally. During busy periods, digital payments could also slow down the process.
The startup therefore reached an extraordinary compromise.
Instead of forcing the entire ecosystem to become cashless, GONA would collect digital payments from passengers and pay drivers in cash.
That solved one problem.
It created another.
A cashless startup that needed cash to survive
This is where the GONA story becomes much bigger than a failed startup.
The company was attempting to digitise a system whose participants had economic interests tied to physical cash.
Techpoint's investigation reports that GONA eventually entered into agreements with transport unions and paid union leaders weekly in an effort to secure their cooperation.
One former technical team member, identified under the pseudonym Tunde Awe, described the payments as an attempt to secure union acceptance.
Another former operations manager, also speaking under a pseudonym, told Techpoint that GONA spent millions of naira on these payments and that demands became particularly expensive in areas such as Oshodi and Berger.
These are allegations from former insiders rather than independently audited figures, and the distinction matters.
But the underlying economic problem is easy to understand.
If a business model removes cash from a system, anyone who earns money from controlling the movement of that cash has a reason to resist it.
And GONA was not merely introducing a new payment method.
It was potentially changing who could see, control and account for transportation money.
The union was not simply a stakeholder. It was part of the economic architecture.
This is perhaps the most important lesson for Lagos State.
A conventional technology startup can think about its stakeholders as customers, drivers, investors and regulators.
But Lagos's informal transport system has additional layers.
There are vehicle owners.
Drivers.
Conductors.
Park managers.
Union officials.
Collectors.
Local enforcers.
And political networks.
The system has historically generated revenue through numerous cash payments and levies.
A 2021 investigation by the International Centre for Investigative Reporting (ICIR) reported that transport unions in Lagos extracted more than ₦123 billion annually in cash levies, with the money linked to networks of political patronage.
That figure should not be treated as a current audited estimate of today's revenue. But it illustrates the scale of the cash economy surrounding transport.
This explains why a QR code can be technologically elegant and economically disruptive at the same time.
A QR code does not simply make payment easier.
It can create a record.
A digital payment can be reconciled.
Revenue can be tracked.
Collections can be audited.
And money that once moved through several hands can potentially move directly from passenger to an account.
That is precisely why digitisation can become politically difficult.
GONA discovered that the technology was the easy part
The most striking aspect of GONA's story is that there was apparently no fundamental technological failure.
The company's original product was functional.
Passengers could use it.
Drivers could receive payment confirmation.
The company attracted investors.
And transaction volume reached almost 10,000 per day.
Even a later Techpoint feature looking at Lagos's successful Cowry Card system acknowledged that GONA had previously attempted QR-code payments on danfos, although the startup eventually disappeared from the market.
So why did the model fail?
Because adoption is not the same as transformation.
You can persuade thousands of passengers to download an application.
You can put thousands of QR codes inside buses.
You can process thousands of transactions.
But if the people controlling the underlying transport network do not accept the new system, technology alone cannot transform the industry.
GONA eventually began retreating.
The startup reportedly reduced operations to a single route, while passengers who had bought digital coins complained that their balances were becoming difficult to use as the network contracted.
Then COVID-19 arrived.
By early 2020, GONA folded.
Its Chinese founders left, according to the Techpoint investigation, leaving behind equipment and phones used by the company.
Its country manager, Noah Gu, subsequently wrote on LinkedIn that he had taken a break to travel and reconsider his goals.
A startup that had once promised to change the way Lagos paid for bus journeys was effectively gone.
Seven years later, government has returned to the same battlefield
The difference today is that Lagos State is not approaching the problem as a startup.
That matters enormously.
LAMATA says its agreement with NURTW and RTEAN followed more than 30 months of engagement with the unions.
The August 2026 agreement creates a framework under which the unions will transition towards cooperative governance and their members will become franchise operators.
The programme covers eight planned Quality Bus Corridors, with four currently under construction:
- Iju Ishaga–Abule Egba
- Ketu–Alapere–Akanimodo
- Iyana-Iba–Igando–Iyana-Ipaja
- Ojuelegba–Lawanson–Cele
Fare collection is expected to become fully digital, while LAMATA retains regulatory oversight.
This is fundamentally different from GONA's approach.
GONA was trying to persuade the existing system to accept technology.
Lagos State is trying to restructure the system itself and make digitisation part of the regulatory architecture.
That could be the difference between failure and success.
But government should not assume that signing an MoU solves the problem
There is a danger in celebrating the August agreement too early.
Signing an agreement is not the same thing as changing behaviour on the road.
LAMATA itself says the process took more than 30 months of engagement.
That should tell Lagos policymakers something.
If government needed two and a half years to negotiate the institutional framework, the difficult part of the project is clearly not installing payment terminals.
It is negotiating incentives.
A danfo driver who currently benefits from flexibility may see fixed digital fares as a reduction in income.
A union structure accustomed to collecting cash may see transparent digital payments as a threat.
A passenger who is comfortable paying cash may not immediately want another application, wallet or card.
And an operator who fears losing control over revenue may find ways around the system.
The government therefore needs to answer a basic question:
What does each participant gain by going cashless?
Technology cannot answer that question.
Policy can.
The GONA lesson: don't digitise the transaction before fixing the incentives
GONA effectively tried to put a digital layer on top of an analogue economic structure.
That was its mistake.
The app could record the fare.
But the surrounding ecosystem still operated through cash.
The company could process a transaction electronically.
But it still needed physical money to satisfy drivers and, according to the investigation, union interests.
It was therefore attempting to build a digital island inside a cash economy.
That is extremely expensive.
Lagos State has an opportunity to do something different.
Instead of simply saying “cash is banned,” government should construct an ecosystem in which digital payments become economically preferable.
Drivers should be able to see their earnings in real time.
Vehicle owners should have transparent revenue records.
Maintenance expenses should be digitally tracked.
Union revenues should be clearly defined.
Government levies should be automated.
Passengers should have receipts.
Disputes should be digitally traceable.
And the fare structure should be predictable.
If all of those pieces work together, cashlessness becomes more than a technology project.
It becomes an operating system for Lagos transportation.
There is another lesson: GONA was too early
It would also be unfair to describe GONA simply as a failed startup.
The company may have been ahead of its market.
In 2019, smartphone penetration, digital-payment habits, transport infrastructure and government support were not what they are today.
More importantly, Lagos had not yet developed the same level of public-sector digital transport infrastructure.
The subsequent success of Touch and Pay's Cowry Card system demonstrates what can happen when a transport payment technology is integrated with government-backed public transport infrastructure.
TechCabal reported that Cowry Card became successful in part because of its relationship with Lagos State and the expansion of state-backed transport infrastructure.
That comparison is important.
GONA tried to digitise the danfo from the bottom up.
Lagos is now attempting to digitise it from the top down.
The second model has a better chance because government can change the rules of the market.
But it also carries greater responsibility.
What happened to GONA's passengers should not be forgotten
There is another price in the story that is easily overlooked.
Passengers trusted GONA.
They downloaded the application.
They put money into their wallets.
They expected the network to remain available.
When the company contracted, some passengers were left holding digital balances that were increasingly difficult to use.
That is a warning for the new system.
If Lagos wants millions of people to move from cash to digital transport payments, consumer protection must be built into the architecture from day one.
What happens when an operator's licence is suspended?
What happens when a payment provider fails?
What happens when a commuter's wallet is debited but the bus never moves?
What happens when the network goes offline?
What happens when a passenger's phone dies?
What happens to people without smartphones?
What happens to elderly commuters?
What happens when a driver refuses a digital payment?
A truly successful cashless system must answer these questions before mass adoption.
The agents paid another price
GONA's story also demonstrates the hidden human cost of startup experimentation.
The company needed people on the streets to persuade passengers and drivers to adopt the technology.
It reportedly created ambassador and agent networks.
But according to the investigation, agents faced aggressive performance targets, and some resorted to submitting fake users when they struggled to meet onboarding quotas. At least one former agent described being fired after falsifying registrations.
Then there was physical risk.
Because GONA agents were carrying cash to pay drivers, the company's attempt to maintain the cashless system paradoxically made some of its employees targets for robbery.
This is the irony at the centre of the entire story.
GONA was trying to eliminate cash from buses but had to carry cash around Lagos to make its model work.
That contradiction eventually became unsustainable.
The biggest question for Lagos in 2026
The question is no longer whether Lagos can build a digital fare system.
Clearly, it can.
GONA demonstrated that seven years ago.
The question is whether Lagos can build a digital transport economy that the people who currently control the system have a reason to participate in.
The new BITP agreement gives government a chance GONA never had.
LAMATA can regulate.
The Ministry of Transportation can enforce.
The unions can be formally integrated.
Operators can receive franchises.
Fare collection can be standardised.
And digital transactions can become part of the official transport architecture.
But the GONA experience suggests that Lagos should not confuse cooperation on paper with cooperation on the road.
A signed MoU does not automatically eliminate the incentives that produced the old system.
Lagos has seen this movie before
In 2019, GONA arrived with QR codes and venture capital.
It promised to solve the same problems Lagos officials are now trying to solve: cash, fare collection, inefficiency and the disorder surrounding informal transportation.
It attracted investors.
It recruited staff.
It recruited drivers.
It attracted passengers.
And at one point it processed nearly 10,000 transactions every day.
Yet the company discovered that technology was the least difficult part of transforming Lagos transport.
Its drivers had incentives.
Its agents had targets.
Its passengers had expectations.
The unions had economic interests.
And the streets had their own rules.
GONA eventually disappeared.
Now Lagos State is attempting the same transformation with something GONA never possessed: regulatory power.
That could make all the difference.
But it also means that the government cannot afford to treat this as another technology rollout.
If Lagos wants cashless danfos to survive where GONA failed, it must digitise not just the payment.
It must redesign the incentives around the payment.
Otherwise, seven years from now, another investigation may be asking the same question:
How did Lagos spend years trying to make danfos cashless — only for cash to win again?
Documentation and source trail
The historical GONA model, its QR-payment system, UNILAG rollout and 2019 transaction volumes are documented in contemporary reporting by and its 2019 funding report. The 2019 financing was also reported by and Chinese technology publication 36Kr.
The detailed account of the union conflict, weekly payments, alleged violence against agents, operational retreat and GONA's eventual collapse comes from . Those specific allegations should be understood as accounts attributed to former GONA personnel, not as independently adjudicated findings.
For the present-day policy, states that the BITP will integrate informal operators into a regulated network, introduce digital fare collection and operate across eight Quality Bus Corridors after more than 30 months of engagement. Independent reporting by and provides additional context on the August 2026 agreement.
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