Author: Ana Stanca
Demand Generation Leader, Enghouse Transportation
U.S. Bank believes the $1.2 trillion infrastructure Investment and Jobs Act signed into law last year will be a boon for contactless tap-to-pay transit payment systems.
In an article published in Government Technology last month, U.S. Bank says the massive infrastructure legislation includes language for the development of open loop fare payments via credit card reader, including contactless technology, for safety, sustainability and accessibility reasons.
Otherwise known as Eurocard, Visa, and MasterCard (EMV) payment systems, the tap-to-pay systems are replacing “outdated fare collection systems, prepaid rides, confusing kiosks, paper tickets, proprietary transit-specific apps, and handling cash.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.”
U.S. Bank says that in addition to removing cumbersome payment transactions, tap-to-ride programs typically reduce costs for passengers and operators.
Transit riders want to see open-loop EMV contactless payment systems introduced to the U.S. market.
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.
U.S. Bank pointed to three reasons legacy closed loop payment systems are impeding the passenger experience and adding costs for operators:
Speaking of innovation in public transportation, U.S. Department of Transportation Secretary Pete Buttigieg stated that the agency is “working very hard to make sure that ‘innovation’ isn’t just a buzzword that loses its meaning, but a means to an end.”
U.S. Bank says the benefits of open loop contactless payments include: