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Connecting Cities: Global transit solutions
Contactless smartcards for public transport have become part of the normal fabric of life in many large cities around the world. In Europe alone, there are more than 100 national or city transport smartcard schemes in operation. However, cities bear the adverse effects of a lack of interoperability between fragmented solutions:
- Lost public transport revenues – many visitors arriving in cities are people who routinely use public transport in their home city but find the challenge of engaging with a new city’s transport system too taxing to be worth the investment of time.
- Lost business activity and revenue – this complexity not only deters people from choosing public transport at all, but also from visiting all the sights in a city they might have visited during their stay.
- Unproductive staff time – all too often staff members are assigned to customer service roles to meet the needs of visitors requesting comprehensive explanations of the public transport system and its associated smartcard.
- Wasted investment in smartcards – Transport for London’s public statements indicate that since the start of the Oyster program they have issued more than 50 million smartcards despite the fact that the population of the city is only about 8 million.
- Negative / lost potential for end user experience – Whether visiting or living in a city fragmented solutions result in deterred use or loss in potential to interact with a consumer and enhance their experience.
Is there an alternative approach to public transport fare collection in cities that generates fewer adverse effects? Over the decade in which contactless smartcard ticketing has become widespread there has also been a convergence of the ticketing and the payments industries i.e., the use of general purpose payment cards on transit systems.
Contactless technology allows the cards to be used at speed for low-value payments, and recent work in London and elsewhere has resulted in the creation of a set of transaction rules specifically for public transport operators that allow for distance-based pricing. Acceptance of contactless payment cards for public transport fare collection can be introduced alongside continued acceptance of closed-loop smartcards. Such a scheme has recently been implemented in London where fare payments can now be made using the Oyster transit card and contactless payment card, leaving travelers with the ability to choose the method most convenient for them. London has seen high adoption rates with around 200,000 different contactless payment cards used daily.
Contactless technology has seen great success across the world and there are some good examples in Russia where MasterCard is actively promoting the advantages of this innovative method. Our first project was deployed with Aeroexpress who provide rail connections between Moscow Airports and the city center; travelers from around the world can now access rail connections to the city and pay for their fare with a quick and simple Tap and Go. The beginning of this year saw the launch of another remarkable project in Saint-Petersburg, the second largest city in Russia, where for the convenience of millions of passengers Saint-Petersburg Underground was equipped with contactless readers at turnstiles. With several stations in the Moscow Underground also accepting contactless payments at ticket machines we can see that the Russian market is actively moving forward with contactless technology and delivering the associated advantages to all stakeholders involved.
At MasterCard, we have been collaborating with some of the biggest cities – such as London, Moscow, and Saint-Petersburg – to help innovative cities and transit agencies to enable citizens to pass their time as conveniently and efficiently as possible and take a further step towards bringing cash free commuting to cities around the world, with innovative contactless payment technology an integral part of the 21st Century metropolis.
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