Despite some industry pessimism, Transport for London says it hopes to see a cross-border contactless transit and payment card rolled out by 2012 that would support access to transportation services both domestically and overseas.
The agency is working with several other transport operators in the United States, Europe and Australia to “develop common standards for the technology,” a Transport for London spokesperson tells PaymentsSource. The transit operator also is in talks with several card companies, including Visa Inc., MasterCard Worldwide and American Express Co., she adds.
Transport for London is upgrading its ticketing systems, first for buses and then for the London Tube network, to accept network-branded contactless credit or debit cards, the spokesperson says. Financial institutions would develop and issue the actual cards.
Most London-based consumers already use a contactless transit card, the Oyster card, which the TranSys consortium developed in 2003 and now is controlled by San Diego-based Cubic Transportation Systems Ltd. The Oyster card enables cardholders to use contactless technology on all modes of transportation within London. Riders may load funds to their card account either online or by using a ticketing machine.
Consumers also may combine the Oyster application with a Visa-branded chip-and-PIN credit card issued by Barclaycard UK for use on accessing the London transport system. In the U.S., the New York City transportation system is testing a similar multifunction card (
Combining a transit card with a debit or credit card function increases consumer convenience and reduces Transport for London’s commission and processing costs, Kulveer Ranger, a transport adviser for London’s mayor, said in a recent news release.
Some experts, however, do not believe the 2012 goal is possible. “The challenge is the interoperability of the different transit systems involved,” Tony Craddock, CEO of Global Prepaid Exchange, reported in a recent newsletter. “Different from Near Field Communication-based mobile payments, which has strict standards, contactless transit fare collection lacks a similar international standards body.”
Additionally, while “card technology should be transferable across borders and it’s great that the industry is working toward more cross-border alliances,” it may be difficult to convince consumers of the value of the card, Matt Simester, director of Auriemma Consulting Group in the UK, tells PaymentsSource.
Many frequent travelers would appreciate this type of card, but others may prefer to keep their finances separate and may not want to combine their bank or credit card with their transit card, Simester contends.
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