Understanding Open Payment Technology in Transit Solutions
An open payment technology solution integrates bank-issued payment methods directly into transit fare collection and access systems. Unlike traditional, proprietary fare cards, open payment solutions utilize familiar banking products—contactless credit and debit cards, mobile NFC apps, and wearables—to streamline the payment process and make public transit more accessible.
With EKTEC Corp’s OPCS solutions, public transportation systems can now adopt open payment technology, creating more efficient, cost-effective, and secure fare collection for operators and passengers alike.
Benefits of Open Payment Solutions
Open payment solutions, like OPCS, bring a range of benefits by leveraging bank-issued payment methods already in users’ possession. Here’s how they reshape transit fare collection:
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Cost Savings on Proprietary Card Management
- No Need for Proprietary Cards: With open payments, there’s no requirement for transit-specific cards, reducing initial setup and operational costs.
- Reduced Inventory Management: The system doesn’t rely on transit cards, eliminating the need for stock, distribution, and management.
- No Reload Stations: The removal of physical reload machines and personnel cuts costs related to infrastructure and staffing.
- Minimized Cash Handling Costs: By bypassing cash handling, transit agencies save on secure transportation, counting, and storage.
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Direct Payment from Bank Accounts
OPCS deducts fare payments directly from the user’s associated bank account or credit line, offering a streamlined payment process and added security. -
Enhanced Security and Reduced Risk
- Cash-Free Transactions: Open payments eliminate cash handling, reducing risks associated with theft and counterfeit.
- Lower Operational Needs: No cash-based reloading points are necessary, cutting logistical, staffing, and infrastructure costs.
- No Need for Cash Transportation: The system’s reliance on digital payments removes the need for cash transport, counting, and handling services.
Benefits for Transit Users
Open payment solutions offer users a convenient, accessible fare collection system:
- Reduced Wait Times: Users no longer need to wait at reload points, as payments are made directly via their bank-issued cards.
- Cash-Free Convenience: Riders can pay with a card they already own, eliminating the need to carry cash for transit.
- Eliminated Loss Risk: With open payments, users avoid the risk of losing a transit-issued card, which could incur additional costs.
- Familiar Payment Methods: Riders can pay using a method they are already comfortable with, such as a debit or credit card, mobile app, or wearable device.
Options for Non-Bank Users
For users without access to bank accounts or those who prefer not to use them, OPCS solutions offer an EMV-based reloadable card model. These cards can be purchased at retail stores or distribution points and are compatible with the OPCS fare collection system, ensuring that public transit remains accessible to everyone.
Why Open Payments Outperform Closed-Loop Systems
Traditional closed-loop systems, such as balance cards, have long been a staple in public transit fare collection. However, as technology advances and user expectations evolve, these systems increasingly show their limitations. Open payment solutions, like EKTEC Corp’s OPCS, address these challenges directly, offering superior efficiency, cost-effectiveness, and user convenience.
Key Limitations of Closed-Loop Systems
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High Cost of Ownership:
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Card Issuance and Management: Closed-loop systems require transit agencies to issue and maintain proprietary cards, incurring costs for production, distribution, and inventory management.
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Reload Infrastructure: Balance cards depend on reload stations, which require physical infrastructure and staffing, adding to operational expenses.
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Complexity for Users:
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Limited Access: Riders must obtain and reload specific transit cards, which can be inconvenient, particularly for infrequent users or tourists.
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Loss Risks: Losing a balance card can mean losing stored funds, resulting in additional replacement costs for riders.
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Cash Handling Requirements:
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Balance card systems often require cash-handling operations, increasing costs for secure transportation, counting, and storage.
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Advantages of Open Payment Systems Over Balance Cards
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Cost Efficiency:
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No Proprietary Cards: Open payment solutions eliminate the need for transit-issued cards. Riders use their existing bank-issued contactless cards, mobile apps, or wearables.
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Reduced Infrastructure Needs: Without the need for reload stations or card management, agencies save on operational and infrastructure costs.
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No Cash-Handling Overhead: Open payments rely on digital transactions, removing cash from the equation entirely.
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Ease of Use for Riders:
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No Barriers to Entry: Riders can use familiar payment methods—credit or debit cards they already own—without needing to purchase or reload transit-specific cards.
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Seamless Boarding: Direct payment from a rider’s bank account streamlines the boarding process, reducing wait times.
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Scalability and Accessibility:
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Universal Payment Options: Open payment systems integrate seamlessly across different modes of transit, enabling a unified fare experience.
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Options for Non-Bank Users: For riders without bank accounts, EMV-based reloadable cards can serve as an inclusive alternative, ensuring accessibility for all users.
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Enhanced Security:
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Fraud Prevention: Bank-issued payment methods come with built-in security measures, reducing risks of fraud and counterfeit.
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No Loss of Stored Value: Riders do not need to worry about losing funds on a proprietary card.
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Why the Shift to Open Payments Matters
As transit agencies aim to modernize and meet the expectations of a digital-first world, open payment systems provide a compelling path forward. By eliminating the inefficiencies of closed-loop systems and focusing on user-centric solutions, open payments:
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Simplify operations for transit agencies, reducing costs and complexities.
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Provide riders with the convenience and flexibility they expect in today’s digital landscape.
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Align with global payment trends, ensuring compatibility with future innovations.
The choice is clear: transitioning to open payment technology isn’t just an upgrade—it’s a necessary step toward a more efficient, accessible, and sustainable public transportation future.