Author: Ana Stanca
Demand Generation Leader, Enghouse Transportation
EMV allows industry to enhance equity in the delivery of services to communities.
In the current migration from legacy closed loop payment systems to the more versatile contactless EMV systems, transit agencies have a historic opportunity to reach out to two markets that have long been underserved – the unbanked and the economically disadvantaged.
First let’s address the unbanked.
Generation Z, also known as Zoomers, is the 16–24-year-old market segment that represent what’s next in American culture.
Global payments platform Thunes published results of a study of 6,500 Zoomers that aimed to learn how they live their lives and what that means for retailers and other customer-facing businesses.
The Thunes study found that 62 percent of Zoomers do not have a bank account and in some emerging markets nearly 50 percent prefer mobile wallets as their choice of payment method. About 25 percent of Zoomers in western markets almost never use cash.
Katherine Conrad, director at Ohio’s NEORide, believes EMV-enabled payments are one of the keys to rebuilding ridership on U.S. transits.
NEORide is an Ohio council of governments working to better co-ordinate transportation and streamline operations to make it easier for riders to use public transit to travel across the state and beyond. NEORide includes 19 transit agencies across four states in Ohio, Michigan, Kentucky and Arkansas.
“I think smart ticketing has become really important in recent years because, right now, the culture has shifted to having access on-demand, especially payment options, on our smartphones. So, public transit needs to continue on with that trend in order to be part of the fold. Therefore, we now offer mobile ticketing through smartphones via our EZfare program and then, for those individuals who maybe don’t utilize a smartphone, we will be implementing smartcards in 2023,” she told Intelligent Transport.
Conrad said the EMV smart cards will also help provide more equity in the delivery of services to the economically disadvantaged.
“Public transit is primarily about equity, making sure that individuals, no matter their income type or education level or circumstances, have access to transportation in order to be able to move around the world freely, get jobs, go to school, medical appointments and so on. Thus, transit doesn’t want to bring forward a barrier that would impede any of that,” she said.
Conrad said the Cleveland EZfare system will include a fare capping feature that will allow economically disadvantaged users to pay the lowest fare possible.
Fare capping, as the practice is known, is generally structured around a maximum fare a rider pays over the course of a day or month. In other words, once a rider pays the equivalency of a monthly pass — whether that takes a week or two — the remaining rides that month are free. Or, once multiple transfers on a given trip reach a certain amount, the rest of the day’s trips are free.
Marty Greenstein, assistant deputy of communications at the California Transportation Agency (CalSTA), said fare capping is a key strategy to improve the transit riding experience and make it more affordable, particularly for people who might not be able to pay the entire cost of a monthly pass up front.
CalSTA’s Integrated Travel Project (Cal-ITP) is working to enhance the state’s travel experience.
“Today, residents and visitors face a disaggregated public transportation network that is often not as friendly to use as it might be, is costly to operate and that faces new competition for ridership in many places. To address these issues, and improve the current mobility system, the California State Transportation Agency (CalSTA) and its partners are engaged in an initiative to facilitate easy and accessible travel planning and payments across California. Cal-ITP is dedicated to making travel simpler and cost-effective for all,” the agency’s website proclaims.
Earlier this year, U.S. DOT Secretary Pete Buttigieg emphasized the importance of equity in the transportation system.
“Every transportation decision is inherently, in many ways, a decision about equity,” he said.
According to APTA, the average household spends 16 cents of every dollar on transportation, and 93 percent of this goes to buying, maintaining, and operating cars, the largest expenditure after housing. A household can save nearly $10,000 each year by taking public transportation and living with one less car.
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