How are future-looking urban mobility providers and transit operators leading innovation in payment acceptance?
Over the years, public transport systems around the world have been building choice and convenience into their ticketing and payment systems. When transit operators launched their own proprietary cards, the cards soon became a popular alternative to paper tickets. Account-based ticketing programs—paired with mobile apps—have now been developed to help riders to get more out of their closed-loop cards.
Further innovations in digital payments have enabled open-loop tap-to-ride, making it easy for anyone to pay for a journey with their contactless EMV® bank card or digital wallet. Over the past decade, open-loop has gained traction and has been implemented in transportation systems in more than 500 cities worldwide.1
So, what's next for payment acceptance in mass transit? And how can operators make sure they're ready?
Change is here, and there’s more to come
As consumers adopt emerging payment options in other areas of their lives, they may expect mass transit operators to offer the same choices. We’re seeing that contactless ’tap-to-ride’ is a natural evolution of contactless ’tap-to-pay’.
Installments and buy now, pay later (BNPL) have become a popular way to spread out the cost of expensive purchases. Could it become a way to buy higher-cost tickets, like annual travel passes? Or when a passenger uses the chat function on a transit operator's website or mobile app to ask about ticket options, an operator could enable them to make an in-chat payment to buy their ticket on the spot.
And integrating open banking into an account-based ticketing system, for example, could allow riders to pay for all their travel at the end of the month by electronic bank transfer. Cryptocurrency could also become a payment method of choice in the future.
Innovation through tokenization
Tokenization (replacing personal and card sensitive information with an unique identifier) is being increasingly embraced to help passengers pay securely and step straight onto their bus or train as they tap to ride without waiting for the transaction to be authorized. Transit operators can also use tokenization to gain more insights about passengers’ riding habits across all their journeys. Recognizing passengers across multiple channels each time they travel opens the door to a world of innovation that can help meet their expectations around choice, value, and ease of use:
A more personalized experience
A transit operator that can recognize riders could propose the best route to reach their destination. Route suggestions could be coupled with a range of payment methods, which could include installments built into a rider's digital wallet.
Recognizing riders makes loyalty programs and rewards possible in mass transit, delivering new value for customers. An operator could, for example, partner with a coffee shop to reward season ticket-holders with monthly discounts off their favorite drinks.
Unlocking your city’s potential
Digital payment systems can help make mass transit more inclusive and simpler to use as well as improve ridership across all demographics. A city that embraces digital payment systems also embraces the potential to increase interoperability, unify transport methods, and create efficient, unified travel experiences door to door.
Naturally, there will always be some riders who want or need to use cash to buy tickets or top up closed-loop cards. Keeping those options available will be important for inclusivity, even as we head into an increasingly digital future.
As the payment landscape continues evolving, transit operators need to be confident their payment acceptance systems can keep pace. Incorporating an open, scalable, and flexible payment platform means they can adapt quickly and confidently to meet riders' expectations and provide a foundation for future innovation.
So, are you ready to create new payment experiences for riders? Read our guide to discover how you can incorporate secure, cost-effective, and scalable solutions that simplify payment acceptance and help you keep pace with the evolving payment landscape—today and tomorrow.
1 "Tap to Ride – Whole Nation & Regional Contactless Payments for Urban Mobility," Visa, 2022.