With the introduction of a new online service, Ukrainians can now check all the information about a car that interests them, without middlemen or bribes
“It used to be that you simply couldn’t buy a used car without an intermediary, which meant you didn’t know what you were getting because there was no access to information about used cars.”
Oleksiy has a retail produce business in Ukraine which means that he often has to drive around the country to set up deals with growers and distributors, check the quality of the goods, and pick up various items. His company normally has several vehicles in its fleet at any given time, both passenger cars and cargo vans. Every vehicle that Oleksiy buys has been used before and the fleet constantly needs replacements.
Buying a second-hand car in Ukraine used to be anything but simple. Oleksiy would go to the online marketplace, find a car he liked and drive to the city where it was being offered (typically somewhere in western Ukraine) to check it out. While there, he would get the vehicle identification number (VIN) from the owner and call a friend at the Auto Inspection Service (DAI), who would verify it in his database. Since these databases were not accessible to the public, business owners like Oleksiy would have to have an “in” at the DAI.
“It used to be that you simply couldn’t buy a used car without an intermediary, otherwise you didn’t know what you were getting because there was no access to information about used cars,” explains Oleksiy.
By searching the database, Oleksiy’s connection at the DAI was able to uncover information such as whether a car had been involved in any accidents, the number of previous owners it had had, and the date it was first registered in Ukraine. Each VIN verification service cost Oleksiy UAH 5,260 ($200). Another UAH 2,630 ($100) went towards his trip to get the car from another town and DAI assistance with registration. In short, Oleksiy was paying on average an additional UAH 7,890 ($300) in bribes per car. Unless he paid these bribes, Oleksiy risked buying a stolen car, a car with a tampered odometer or one with other hidden problems and damage.
As of December 21, 2018, Ukrainians can search a car’s history by its VIN for UAH 45.68 (less than $2) through the Driver’s Web Portal. Users of the Driver’s Web Portal can also place themselves in an online queue to register a vehicle, order a driver’s license, or get an individualized license plate. Since Oleksiy typically buys a car every one or two years, the Portal allows him to save between $150-300 a year.
According to other drivers, prior to the launch of the Driver’s Web Portal, access to VIN databases was available through bots such as @AutoData_Bot and @UsefulDataBot that required users to pay a fee of $200 to perform searches. This illegal service continues today and costs between UAH 100-500 ($3.80 – $19) per VIN, but as Portal users increase, demand for these shadowy services will inevitably decrease.
During 2018-2019, the used car market continued to grow rapidly in Ukraine. For instance, in January-May 2019, 230,9 thousand used cars were registered, which is 7 times more than a year earlier.[1] In other words, even if the sale of used cars continues at this pace, the potential customer base for VIN-based vehicle checks will expand by tens of thousands of users a month.
With the growth of the market of used cars, Ukrainian drivers are expected to save above $100 million in 2019 on VIN verification services alone.[2] This amount of savings is a modest estimate as it assumes that drivers will conduct VIN verification services for a single car. In reality, drivers typically request VIN verification services for a number of different vehicles before deciding which one to purchase. So, the amount of potential savings of the Ukrainian drivers could be in two times even higher, while the contribution to the state budget will grow. Therefore, thanks to the Driver’s Web Portal, the state becomes richer, not corrupt officials.
As of July 2019, 140047 individual users and 4459 legal entities have registered on the Driver’s Web Portal since it was launched in December 2018. Portal users have obtained 204394 free extracts (i.e. documents containing basic information about a vehicle such as its color, make, model and engine type); paid for extracts 13004 times (i.e. using VIN numbers to surface information about a vehicle such as its accident history, whether or not a car has been stolen and the total number of previous owners); and made 53581 entries into the electronic queue in order to receive and pay for services. Before the introduction of the Driver’s Web Portal, these services were paper-based and most were acquired by paying bribes to corrupt government officials.
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The eServices component of the USAID / UK aid project Transparency and Accountability in Public Administration and Services (TAPAS) supports state authorities with the eTransformation of their administrative services so that public service delivery is more transparent, convenient and efficient. The eServices team updates and improves the legislative framework required to transform services, streamlines business processes for receiving eServices and develops technical solutions.
Nine eServices have been developed and launched to date under
the TAPAS program. Currently, the most popular eServices are: the declaration
of compliance with fire safety regulations: fire safety licenses;
transportation carrier’s eCabinet (user account); various services within the
Driver’s Web Portal; and the permit for special water use.
[1] Ukrainian Motor Vehicle Manufacturers Association’s data
[2] Based on the cost on the gray market – $200 per vehicle and the average amount of registered used cars above 46,000 per month
EF-TAPAS-Impact-Story-Driver_s-Web-Portal
