Author: Ana Stanca
Demand Generation Leader, Enghouse Transportation
Transit industry leaders are touting new technologies in the automated fare collection (AFC) space that will revolutionize the industry.
For decades, transit agencies operated on the general principle that riders of their systems needed to have an agency account and a transit card or pass that allowed entry into the public transit system.
These cards required balances be replenished and were independent of other customer payment methods.
These legacy systems required transit riders to purchase tickets at vendor kiosks and ticket booths and were often plagued by long queues and frustrating delays.
Enghouse Transportation is part of a paradigm shift in the industry to move away from those “Closed-Loop” payments systems and adopt the new Open-Loop contactless payments that enable transit riders to use the same Eurocard, Mastercard and Visa (EMV) forms of payment already used for routine purchases such as coffee, snacks, groceries, and gasoline. Experts say Eurocard, Mastercard, and Visa (EMV) payment systems are the wave of the future.
Enghouse Transportation has established itself as an industry leader in the Netherlands and Central and Eastern Europe and is bringing that expertise to the U.S. market.
In the recently published Solution Guide, “What to Look For in an Automated Fare Collection Solution,” we spells out how an AFC system works.
There are four fundamental elements of an AFC system:
The upside to Open-Loop contactless AFC is tremendous. The company’s software solution enables transit agencies to supply fare capping and discounts to specific customers and enable tap and pay transactions that would allow transits quicker boarding times, contactless payments for health/pandemic concerns, and access to a customer portal where transit riders could download receipts, view their travel history, or pay account balances. The system can also enhance travel planning.
The transit industry is moving toward Open-Loop payment systems.
In Visa’s Future of Urban Mobility study, 88 percent of riders surveyed expect to pay with a tap on trains and buses. The report also states there are more than 700 U.S. transit projects underway that include the introduction of contactless tap-and-go payment methods.
It’s time to say goodbye to outdated fare collection systems, prepaid rides, confusing kiosks, paper tickets, proprietary transit-specific apps, and handling cash. Open-Loop contactless transit solutions allow passengers — whether frequent commuters, locals, or visitors — to simply use their existing contactless credit card, debit card or mobile wallet to tap to pay for a ride in less than a second.
One development that is accelerating the use of EMV payment cards is the global migration to EMV chip-enabled payment cards across the planet.
According to EMVCo, more than nine of every ten card transactions in 2021 were made using EMV-chip-enabled payment cards. The U.S. saw the highest year-to-year increase, rising by nine points from 72.8 percent to 81.7 percent.
Having a global acceptance of EMV card technology is making it easier for transit agencies to move to Open-Loop systems, which enable the acceptance of EMV-enabled cards.
Other topics in the Enghouse Transportation Solution Guide, “What to Look For in an Automated Fare Collection Solution,” include the following:
Find out more about moving to an AFS system, download the Solution Guide HERE.
Your trusted transportation operations software provider.