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Electronic Payment & Pricing > Transit Fare Payment


Electronic transit fare payment systems, often enabled by smart card or magnetic stripe technologies, can provide increased convenience to customers and generate significant cost savings to transportation agencies by increasing the efficiency of money handling processes and improving administrative controls.


Payment integration efforts should focus on committed, engaged stakeholders and work to minimize the complexity of coordination to avoid cumbersome governance issues.(9/1/2015)

Developing a regional fare policy or system requires, at a minimum, analysis of travel patterns, transit market analysis, and review of institutional barriers and challenges.(March 2010)

Anticipate, understand, address and manage the risks associated with fare card technologies and the vendor relationship.(4/14/2006)

Understand the issues, strategies and trade-offs that motivate agencies to join in a regional partnership and provide appropriate support.(4/14/2006)

Plan for greater time and project complexity than expected.(4/14/2006)

Consider a consensus organizational model to help assure support and participation of partners in a regional fare card project.(4/14/2006)

Provide for appropriate legal support services to address the many significant legal issues faced in implementing a regional fare card project.(4/14/2006)

Establish a coordinated fare structure to effectively accommodate differences in fare structures across participating agencies.(4/14/2006)

Examine the contextual factors and carefully manage the associated issues that will determine the success or failure of a regional fare card project.(4/14/2006)

Seek a variety of funding sources to support a regional fare card project, and offer a finance plan that encourages participation.(4/14/2006)

Consider the value of implementing a limited fare pass system initially to serve as an interim experience base for a comprehensive region-wide electronic fare card system.(4/14/2006)

Install an electronic transit card system to enhance rural transit agency performance and coordinate human service transportation between agencies to achieve more efficient services.(9/1/2005)

Anticipate challenges in planning and deploying smart card technology in a rural environment.(9/1/2005)

Develop a detailed cardholder recruitment plan in the planning phase of the project, to provide guidance on processes to set pricing, and to ensure high user involvement and loyalty.(8/1/2004)

Seek assurances from your suppliers and sub-contractors, that their production and manufacturing schedules will meet your project schedule and inventory requirements throughout the lifecycle of the project.(8/1/2004)

Establish a forum for decision-makers and project managers to come together to receive project updates, work through critical project issues, make decisions, and support successful institutional collaboration in a project involving multiple agencies.(8/1/2004)

Provide for large sample sizes when conducting before/after data collection efforts, to avoid impacting the ability to reveal statistically significant differences during the evaluation's statistical analysis.(8/1/2004)

Include significant planning and development time in the overall project schedule to accommodate identifying and addressing the various compatibility issues, to integrate existing legacy system equipment across multiple agencies.(8/1/2004)

Establish a clear understanding among all partners on the level of technical support to be provided by suppliers and integrators, as equipment provided in-kind or at a reduced cost is often provided with minimal technical support.(8/1/2004)

Establish a champion and open communication among stakeholders to help enable regional smart card programs.(9/1/2001)

Establish a pricing structure for the new fare media that makes them competitive with other available fare media.(9/1/2001)

Ensure customer acceptance of new technology.(9/1/2001)

Use of Transit Signal Priority systems for Bus Rapid Transit can reduce transit time by 9 percent, with minimal impact to non-transit traffic.(06/01/2018 )

RideKC’s Freedom On-Demand, an app-based, same-day transportation service, reduced paratransit trip cost from $27.13 to $15.80 a trip, saving $166,000 in 5 months.(October 5, 2017)

Transit Smart Card fare payment has ability to significantly reduce time buses spend waiting at bus stops for passengers to board.(08/01/2015)

Bus speeds increase by 29 mph after High Occupancy Toll conversion and opening of Priced Dynamic Shoulder Lanes. (January 4, 2013)

Joint deployment of scheduling software and Automatic Vehicle Location/Mobile Data Terminals (AVL/MDT) increased ridership and quality of service for two rural transit providers.(December 2010)

Smart card technology reduces fare collection transaction time by more than 30 percent.(March 2010)

Data archive warehousing pays for itself in less than 1.4 years and scheduling software saves almost four weeks per year for operations planners.(December 2009)

Implementation of ITS with AVL, real-time passenger information, and electronic fare media in a mid-sized transit system resulted in a minimum 3.9:1 benefit/cost ratio.(July 2009)

Fare collection systems that use electronic tickets or passes can reduce passenger boarding times by 13 percent compared to driver operated systems that require exact change.(February 2009)

Transit users and individual operators enjoy most of the benefits of smart cards, while individual transit operators and multiple agencies bear the majority of the deployment costs.(August, 2008)

Full ITS deployment in Seattle projects personal travel time reductions of 3.7 percent for drivers and 24 percent for transit users.(May 2005)

In the Puget Sound region of Washington State, a fare payment integration system that used joint passes to allow base fares to be transferred between agencies increased the percentage of riders that made transfers.(25 March 2005)

Proof-of-payment systems that use ticket vending/validating machines can reduce boarding times by up to 38 percent.(August 2004)

In Chicago, A CTA survey of smartcard users found that features related to convenience, rail use, and speed were most liked by program participants; 21 percent rated convenience over the magnetic stripe card as their single favorite feature of the system. The most desired features were the multi-use functions and ability to recharge the smartcard via the Internet and credit card.(13-17 January 2002.)

Impacts of Transit Fare Policy Initiatives Under an Automated Fare System(Summer 2000)

In 1996, the project benefits of existing and planned deployments of transit ITS technologies were estimated to yield between $3.8 billion and $7.4 billion (discounted dollars for 1996) within several years.(July 1996)

Based on a travel reduction ordinance requiring Phoenix employers with over 100 employees to reduce single-occupancy commuting trips by 5 percent, the City Public Transport Agency led the development of a Bus Card Plus system and as of 1996, 190 companies participated with a resulting 90 percent of express route fares paid by these bus pass cards.(1996)

Smart card electronic payment systems can increase ridership, decrease fare evasion, and reduce administrative costs.(November 1995)

Transit AVL can improve O&M and reduce operating expenses.(November 1995)

In Manchester, UK, transit smart cards that improve data accuracy and reduce data collection costs saved $1.5 million.(September 1995)

Conversion to card-based electronic payment system for small transit agency costs $380,800.(March 2010)

Transitioning to electronic, card-based transit fare collection system costs $41,999,739 for a large transit provider.(March 2010)

Deployment of an Advanced Public Transit System (APTS) for a mid-size transit system costs $150,000.(July 2009)

Capital costs to implement ITS fare collection systems for bus rapid transit (BRT) ranged from $2 million to $6 million.(February 2009)

Capital costs to implement ITS applications for bus rapid transit (BRT) can vary widely ranging from $100,000 to more than $1,000,000 per mile.(February 2009)

The Massachusetts Bay Transportation Authority installed two fare vending machines—one full service and one cashless—at each of the Logan Airport terminal stops at a total deployment cost of $1.26 million.(1 June 2007)

The projected operating costs for a regional smartcard financial clearing center totaled less than $4 million per year.(6 February 2007)

Driver assist and automation systems can substantially increase the cost of a new bus.(2007)

The cost to implement the ICTransit Card system was estimated at $635,700. (9/1/2005)

The annualized life-cycle costs for full ITS deployment and operations in Tucson were estimated at $72.1 million. (May 2005)

A modeling study evaluated the potential deployment of full ITS capabilities in Cincinnati. The annualized life-cycle cost was estimated at $98.2 million.(May 2005)

The annualized life-cycle costs for full ITS deployment and operations in Seattle were estimated at $132.1 million.(May 2005)

TMC central hardware costs can exceed $200,000 if regional communications and system integration are required.(5 August 2004)

System to support the Washington Metropolitan Area Transit Authority multi-agency electronic fare payment card cost approximately $25.5 million.(February 2004)

The cost to develop the Central Puget Sound Regional Fare Coordination Project was estimated at $42.1 million. (29 April 2003)

The cost of the capital infrastructure of the Cape Cod Advanced Public Transit System—which included radio tower upgrades, local area network upgrades, AVL/MDT units (total of 100), and software upgrades—was $634,582.(January 2003)

Electronic fare payment was implemented on 109 buses operated by the Ventura County Transportation Commission for $1.7 million.(13 December 2002)

Mobile Data Terminal - Fixed Route Service - Capital cost/unit - $1747(July 2009)

Electronic Farebox (with smart card reader) - Capital cost/unit - $6000(February 2009)

Magnetic Farecard Processing Unit (upgrade) - Capital cost/unit - $6000(February 2009)

Validating Farebox (includes magnetic card processing unit) - Capital cost/unit - $6000(February 2009)

Electronic Registering Farebox - Capital cost/unit - $6000(February 2009)

Smart Card Processing Unit - Capital cost/unit - $6000(February 2009)

Magnetic Farecard Processing Unit (upgrade) - Capital cost/unit - $6000(February 2009)

Automated passenger counter (APC) system software - Capital cost/unit - $6000(February 2009)

Smart card - Capital cost/unit - $6000(February 2009)

Automated passenger counter (APC) on-board unit - Capital cost/unit - $6000(February 2009)

Electronic Registering Farebox - Capital cost/unit - $6000(February 2009)

Electronic Farebox (with smart card reader) - Capital cost/unit - $6000(February 2009)

Smart Card Processing Unit - Capital cost/unit - $6000(February 2009)

Automated passenger counter (APC) system software - Capital cost/unit - $6000(February 2009)

Smart Card Processing Unit - Capital cost/unit - $6000(February 2009)

Validating Farebox (includes magnetic card processing unit) - Capital cost/unit - $6000(February 2009)

Smart Card Processing Unit - Capital cost/unit - $6000(February 2009)

Validating Farebox (includes magnetic card processing unit) - Capital cost/unit - $6000(February 2009)

Automated passenger counter (APC) on-board unit - Capital cost/unit - $6000(February 2009)

Automated passenger counter (APC) Interface to AVL - Capital cost/unit - $6000(February 2009)

Magnetic Farecard Processing Unit (upgrade) - Capital cost/unit - $6000(February 2009)

Magnetic Farecard Processing Unit (upgrade) - Capital cost/unit - $6000(February 2009)

Electronic Registering Farebox - Capital cost/unit - $6000(February 2009)

Automated passenger counter (APC) Interface to AVL - Capital cost/unit - $6000(February 2009)

Validating Farebox (with smart card reader) - Capital cost/unit - $6000(February 2009)

Electronic Registering Farebox - Capital cost/unit - $6000(February 2009)

Validating Farebox (with smart card reader) - Capital cost/unit - $6000(February 2009)

Electronic Registering Farebox (with smart card reader) - Capital cost/unit - $6000(February 2009)

Validating Farebox (with smart card reader) - Capital cost/unit - $6000(February 2009)

Smart card - Capital cost/unit - $6000(February 2009)

Validating Farebox (with smart card reader) - Capital cost/unit - $6000(February 2009)

Electronic Registering Farebox (with smart card reader) - Capital cost/unit - $6000(February 2009)

Validating Farebox (includes magnetic card processing unit) - Capital cost/unit - $6000(February 2009)

Electronic Fare Payment (EFP) System - Capital cost/unit - $12300(5 August 2004)

Electronic Card Fare Payment System - Capital cost/unit - $550000(March 2003)