Bank Payments in Transportation - Freedom and Interoperability for Congestion Pricing

This paper explores the use of bank-issued Contactless Credit Cards and NFC (Near-Field Communication) technology in public transport. The authors note that, despite technological advances over the past ten years, cash and paper-based tickets are still reality in public transport outside the airline world. The public transport market includes the areas of tolling, mass transit, rail and road user charging or congestion pricing. Most of the approaches analyzed and piloted so far have been smartcard-based. This paper explores the possibilities of using mobile phones to provide eTicketing applications. On a nationwide scale there have yet only been a very few successful smartcard-based implementations— although a wide variety of technology assessments, feasibility studies and cost-benefit evaluations have been conducted. The main reasons for the slow implementation of these smartcard or mobile phone based eTicketing solutions include high initial investment costs and ongoing operating costs for the required highly-complex multi-layered, mobile-technology infrastructure, consisting of check-in/ check-out devices at stations and in vehicles, smartcards, back-end systems, and communication infrastructure. Several business case calculations have shown that these implementation and operating costs would not be outweighed by the reduction in OPEX, CAPEX and distribution costs. In addition, public transport practitioners are skeptical that there will be significant revenue increases directly associated with the introduction of electronic ticketing and thereby cannot justify the massive investment. The authors conclude that cooperation of all the stakeholders needs to be organized and the successful implementation of these new payment options will require collaboration and agreement on business, security, technical and consumer issues.