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More evidence that transit operators are becoming interested in accepting open-loop payment for fares: Both MasterCard Worldwide and Visa Europe announced during the Cartes and IDentification 2008 conference and exhibition last week in Paris they are working with Paris subway, bus and tram operator RATP to potentially enable riders to pay fares by tapping their banking cards on readers at gates on onboard buses and trams. The parties hope to have a trial some time next year. "There is a very good level of interest," Emmanuel Petit, MasterCard country manager for France, tells CardLine Global sister publication Cards&Payments. "It's a complicated project." France's postal bank, La Banque Postal, now the acquiring bank for bankcard purchases riders make when they buy RATP close-loop tickets, also is involved in the project. RATP issues contactless cards for the closed-loop contactless fare-collection application, called Navigo. It has expressed interest in reducing costs for that fare-collection system. And one way to do that in the long run would be to accept bankcard payment, which would enable both local residents and visitors to the Paris area to use Visa- and MasterCard-branded cards to access transit services. But it would require large changes to the fare-collection system, including a more-sophisticated back-end system. RATP also would have to change readers to support the open-loop application, which it could do during its normal equipment-replacement cycle. Also, financial institutions ultimately would have to issue millions of contactless cards. Consumers also could use the cards for contactless retail payments, although there are few readers in stores now. "The fact they are working with us, they definitely want to understand more so they can make a decision," says Omar Rifaat, senior manager in the innovation and acceptance unit of Visa Europe. Visa had set up a mock RATP gate reader at its booth at the Cartes exhibition that accepts both Navigo and Visa's contactless application, payWave. Other transit operators or authorities besides RATP are considering introducing open-loop payment in the next few years, including authorities in New York City and London.
