Smart Move: How Digitizing Public Transit Helps Make Cities More Resilient
Will Judge leads the work of Mastercard’s City Possible team on new mobility, helping global technology and automotive companies develop new solutions in automated vehicles, mobility-as-a-service, multi-modal digital integration and demand management.
As the COVID-19 pandemic changed our way of life around the globe, disruption to daily routines was particularly dramatic for city-dwellers, especially in deeply affected countries and regions, where strict lockdown measures and travel restrictions left normally bustling streets, busy commercial districts and crowded subways eerily deserted.
As those streets, buses and subways begin to fill back up, cities are asking themselves an important question: How do we make public transit safer in the age of COVID-19? Big-city transit is a high-touch, close-contact system — and for most urban populations, simply a way of life. Now users need to limit touch points and avoid close contact wherever possible.
Transport operators, with the imperative to protect their workers and customers, have responded with immediate reviews of their fare collections and ticketing systems. In many cases, that’s prompted them to accelerate the move to digital through contactless payments, mobile ticketing and transit apps. These capabilities will not only help cities endure and emerge from this crisis, but are key to future-proofing our urban centers .
A Need for Speed
The idea of making public transit a more seamless, low-touch experience isn’t new. Cities including London, Singapore and Sydney have been transforming their systems over the past few years. All these cities transitioned to open-loop systems, meaning ticketing and payments do not require a proprietary, independent network. Instead, transit passes and fare payments are digitally linked to the bank-issued payment cards already in passengers’ wallets.
Open-loop transit systems have solved problems in each city that implements them. Singapore launched Asia’s first account-based ticketing system with their existing fare readers. In Sydney — a city where annual international travelers nearly match the number of residents — adopting open loop has made public transit seamless for visitors, who no longer need special fare cards or local currency to ride. Transport for London’s contactless system slashed its cost of fare collection by more than one-third, while its open-loop scanners read fare cards in a fraction of a second, so riders can pass through gates without breaking stride — a commuter’s dream.
COVID-19 has brought new focus to the cleanliness of traditional bank-card use, which involves inserting a chip card into a card reader, then using a keypad or stylus — sometimes both — to verify the account PIN or sign for the purchase. This means one customer after another is touching these surfaces to complete their transactions.
Accordingly, most Americans report the pandemic has changed the way they think about in-person transactions. According to a Kantar behavioral payments panel, as of March 2020, 80% were concerned about signing for purchases, and half worried about the cleanliness of signature touchpads. Nearly three-quarters say they prefer to skip signatures at points of sale.
By contrast, digital contactless payment technology processes transactions securely with the tap (or even a touchless wave) of a card, and doesn’t require PINs or signatures. Consumers can use contactless functionality to sidestep potential contamination by avoiding the keypad and stylus at points of sale across all industries, including transportation. There’s no need to hand off your card to an employee, either.
Concerned consumers have relied heavily on contactless payments for essential services during the pandemic. According to a Mastercard survey in Europe, 90% of consumers who used their cards’ contactless feature did so at grocery stores and 53% at pharmacies. Unsurprisingly, transit use lagged at 13%. But with 90% of contactless-card users reporting the feature was “easy to adopt,” public transit makes a great use case as ridership normalizes.
Contactless and mobile ticketing
Truly open-loop transit systems, which allow travelers to pay with the cards that are already in their pockets or on their phones, are the clear path forward and the ideal future-proofing technology for cities. But planning and implementation of contactless transit networks does take time — a luxury cities haven’t had in the middle of a global pandemic. For many systems that were still relying on cash, mobile ticketing has been a no-touch solution that operators can roll out in just weeks.
Enhanced mobile ticketing solutions use barcodes or quick response (QR) codes on a customer’s smartphone in place of a paper ticket, eliminating physical transit passes so travelers can simply at an entry gate equipped with laser scanning technology. Enhanced mobile ticketing solutions also allow riders to bypass points of sale within the system (both self-serve and attended), which eliminates standing in line with other riders or close contact with a ticket agent to purchase.
Transit apps and digital service integration
Building on mobile ticketing capabilities, transit-system mobile apps are a broadly accessible solution on the path to full digital integration. The near-ubiquity of smartphones and the potential for quick deployment has made public-transit apps a valuable resource in protecting city riders during the pandemic.
When tickets, payment methods and trip information are all stored and accessed digitally through an app, the need for close contact is greatly reduced across the transit system. Apps can provide information, transit status and updates instantly, sparing customers from waiting on line, in close contact with service agents and other riders. Digital ticket scanning is also faster and lower-contact than paper ticket redemption. Beyond COVID-19, mobile apps’ speedy processing, cost efficiency and convenient access to information benefit all parties for the long term.
Moving forward together
As more transit systems move to digital payments, riders and cities will reap the rewards. The same digital technologies that enable safer, low-contact transit in a public health crisis offer numerous benefits for a digital future, including operator cost efficiencies, easing crowding and bottlenecks, making city transit more visitor-friendly and providing the next-level convenience customers are beginning to demand. Digitizing now secures the public transit networks of the future, allowing cities and their residents to evolve and thrive for decades to come.