Digital Transactions Authoritative, insightful and timely information for payments professionals
Transit riders have made one aspect of their mobility routines abundantly clear. They want to use contactless payments to pay as they commute to work or ride to the beach. A full 91% of transit users in the second Future of Urban Mobility Survey from Visa Inc. either strongly or somewhat expect contactless payments options on buses, trains, and other public transit options. That’s up from 88% in 2021.
Released Tuesday, the Visa survey—among 11,500 public transit users in 14 global markets —also found that 62% of U.S. transit riders strongly expect to be able to use contactless payments moving forward, compared with 57% globally, say Nick Mackie, Visa global head of urban mobility, tells Digital Transactions News in an email.
It’s not just contactless-payment adoption that is evolving in transit. So, too, is fare capping. A transit operator may set a maximum fare to be paid daily once a ride threshold is reached. “The way people move around has changed over the past two-plus years to become much more flexible,” Mackie says. “Fare-capping presents an option that can cater to the needs of just about every rider, without sacrificing the traditional benefits of a monthly or weekly pass. When riders pay for their trips with their existing contactless-enabled credit or debit cards, fare-capping means there is no need to tie up funds in a transit card, ticket, or monthly pass.”
Fare capping is easier for transit agencies to offer because more of them are using account-to-account funding mechanisms instead of stored-valued accounts. Funds can be withdrawn from a user’s account to keep just enough to pay for the expected ride frequency as needed without setting aside a whole month’s funding.
Mackie cites the New York City Metropolitan Transportation Authority’s fare-capping plan as an example. “Patrons of New York’s Metropolitan Transportation Authority (MTA) stop being charged once they hit 12 fares in a given week,” he says. “Visa’s Future of Urban Mobility survey found that fare-capping has been popular as riders further integrate transit into their everyday lives. Our research found that fare-capped rides would encourage 61% of surveyed public-transit users to ride more often than without capped fares.”
While the Covid-19 pandemic reduced transit use, volumes have been returning, but now with different expectations among transit riders than before. “We’ve seen digital payments become a mainstay for many transit riders across the globe, but this year’s research shows an overwhelming number who expect contactless payment options throughout their journeys,” Mackie says.
