CTA Exploring New Way to Pay – “Smart Cards!”

CTA Exploring New Way to Pay – "Smart Cards!"

USING YOUR SMART-CHIP VISA OR MASTER CARD TO PAY FOR CHICAGO MASS TRANSIT MAY BE AVAILABLE IN ABOUT A YEAR!

It’s already in place in Hong Kong and in London. It’s being tested on the New York City Subway System. The process involves a smart chip implanted in standard Visa and Master Card Credit Cards which can be programmed to automatically deduct fares on buses and El stations.

The card would also be programmed by transit agencies around the world to make fare paying as easy as touching your credit card to a sensor on the bus or at the El platform.

The same technology currently exists in the Chicago Plus Cards now being offered by the Chicago Transit Authority. With the current cards each embedded with a smart chip individual bus train and transfer fares are directly debited from a pool of funds (usually about $50) charge to personal credit cards using the CTA website. When the balance in your account goes below $10 another $50 amount is automatically added.

There are two negatives with this system however.

First the transit agency must first manufacture and distribute separate dedicated and costly Chicago Plus Fare Cards themselves. Second they must act like a bank holding large sums of fare money in hundreds of accounts until they are used by system riders.

Combining a chip with a consumer’s existing credit card would eliminate the need for separate fare cards. Also and more importantly for the CTA it would be the credit card companies that would take responsibility for charging or debiting the rider’s account and handling all security and fraudulent use issues.

In all aspects aside from the implanted chip the Smart Card would function exactly like a standard credit card usable at any other business where the credit cards would be normally accepted.

Consumers on credit card points programs can also earn additional frequent-use points for trips they take on the CTA and on other participating transit agencies.

As with current Chicago Plus and Chicago debit fare cards each fare transaction would be processed in a fraction of a second eliminating long lines at El stations or other locations where pre-paid fare cards are now sold. Those without a credit card mainly riders with low income or poor credit would still have the option of paying fares via CTA Transit Card or pay a higher per-ride cash fare.

CTA President Ron Huberman announced yesterday that Visa and Master Card as well as other credit card companies will be invited to bid on the new virtually-cashless fare paying system. He anticipates the new Smart Card program can begin as early as the end of 2009 and would take several years to be completely phased in.

Said President Huberman "We believe this is where the market is heading and we don’t want to be chasing it."

For more info see Jon Hilkevitch’s story in yesterday’s Chicago Tribune.

DEAN MOSS & DEAN’S TEAM CHICAGO