How Fare Collection Tech is Changing Transit Operations

In an article for GovTech, Skip Descant describes how cashless fare payment technology on public transit is changing the way transit agencies collect fares, enable fare capping, and speed up service.

According to Descant, “Fare-capping is often championed by transportation equity advocates as a way to corral runaway transit costs for low-income riders, since fares are capped at a certain amount for a set duration of time.” Technology now enables fare capping that wasn’t possible with cash payments. “But open loop systems can go beyond fare-capping to provide rich caches of data that officials can use to design incentives, loyalty programs and even routes,” Descant adds.

Newer fare payment systems also offer ‘open loop’ payments, meaning riders can use any debit or credit card to pay rather than a system-specific card. “New developments in areas like digital driver’s licenses could be made interoperable with digital fare payment systems to quickly and accurately validate data like age, disability or veteran status — all of which are often linked to transit discount programs.”

A 2022 study from the University of Oregon revealed a need for a cash payment option, however, noting that many of the people who depend on transit the most are still more likely to be unbanked.