Manchester transit fare project builds momentum for U.K. contactless payments

In seeking to establish a London-style Oyster card system in its city, Manchester officially launched its contactless payments capabilities on the Metrolink Tram on Monday.

Transport for Greater Manchester has worked with Visa to deliver "Get Me There" contactless technology on debit or credit cards, allowing the occasional Metrolink traveler to more easily make payments when using the trains. Regular riders obtain discounts through the use of TGM's "anytime" travel cards.

Manchester is advancing its contactless payment transportation network to become part of the U.K.'s growing trend of new payments technology for travel.

Paul Thomas/Bloomberg

Visa research indicates that nearly half of U.K. commuters consider contactless payments as the single most significant improvement to their overall public transportation experience. In that regard, TGM officials see the rollout as a way to get commuters more comfortable using the system, especially since Visa also reported that public transport use could increase by 27% if payment was made easier.

"People now expect to pay as swiftly and seamlessly for travel as they do for any other purchase, so bringing contactless to Metrolink is a huge step forward for the city, and a boost to customer experience in on the U.K.'s largest tram network," Stephen Rhodes, customer director at TGM, said in a Monday press release.

Commuters also noted that the "touch and go" card linked to an app provided convenience, with 24% saying it provided the ability to track spending, while 45% found the reduced time waiting to purchase tickets and 59% cited it alleviating the need for carrying cash as key benefits.

"The U.K. continues to lead the way when it comes to contactless payment systems on public transport," Steven Orelowitz, head of transit, Europe for Visa, said in the press release. "By adopting a contactless system that enables customers to simply turn up and travel without having to work out which ticket they need, Manchester has put itself up there with some of the most forward-thinking global cities when it comes to ensuring that locals and visitors can move around with ease."

With much of the attention on London and Manchester as cities that have transformed into cashless hubs, the city of Bristol in the U.K., a leading university city in the country, has nearly 75% of its transactions taking place with contactless technology, according to data from Paymentsense.

The advancement of contactless payment on Manchester's Metrolink system, however, will add to the growing numbers of consumers choosing to tap and go with a card in the U.K.

Other data supporting this trend includes research from UK Finance that indicates 725 million contactless card transactions took place in the U.K. in April of 2019, a 22.4% increase over the 592 million in the same month a year earlier. The data included both U.K.-issued cards and cards issued overseas.

The total value of contactless transactions was £6.8 billion in April 2019, a 22.1% increase from £5.6 billion in the same month a year earlier.

Mastercard reported late last year that the transit companies benefit from reducing the costs of collecting fares at the stations deploying contactless technology in the U.K.

In a case study of Transport for London's Oyster contactless card network for trains, buses and the Underground Tube, Mastercard found that the cost of collecting fares dropped from about 14% to 9% by 2015 alone, while revenue rose from 86% to 91%.

In other parts of Europe, Visa reported late last year that Poland was going to be the first country in the world to have 100% of its checkout terminals capable of accepting contactless payments.

Visa also cited Singapore as one its largest cities for contactless payment acceptance, with more than 40,000 contactless acceptance points added for the Land Transport Authority of Singapore's bus and train network.