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Is smart ticketing being held back by bespoke systems?

Research report sets out to examine some of the key challenges transit agencies are facing when it comes to providing fare collection services to riders.

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More agencies are moving away from physical tickets to the use of contactless
More agencies are moving away from physical tickets to the use of contactless

Two thirds of transit agencies (64 per cent) are looking to implement account-based ticketing but bespoke technology is holding them back, according to a new report.

 

The report says such systems can be slow to deploy, costly to maintain and have limited upgrade paths.

 

Fare collection services

 

The Transit Agency Research Report: The State of Fare Collection released by ticketing and payments technology provider, Masabi, sets out to examine some of the key challenges agencies are facing when it comes to providing fare collection services to riders.

 

More than 60 transit agencies, predominantly based in the US, were surveyed about ‘core’ automatic fare collection (AFC) systems and the impact these systems are having on their ability to innovate with new fare collection and ticketing technologies.

 

‘Core’ AFC, in this instance, refers to the primary back office solution or sales channel with the highest percentage of sales.

 

Key report findings include:

  • 43 per cent of agencies have been operating their core automatic fare collection (AFC) systems for longer than a decade
  • Most core AF systems take one to two years to go live (30 per cent), with a further 11 per cent taking over three years
  • 59 per cent of agencies stated adding new features to their system was either ‘hard’ or “very hard” with updates occasionally or hardly ever happening
  • 41 per cent of agencies declared that they are paying over 10 per cent of their fare revenue to run their AFC system
  • 62 per cent of agencies have either deployed or will deploy an account-based ticketing system for their riders
  • 24 per cent of agencies are looking into deploying account-based MaaS while 22 per cent are interested in practical mobility-as-a-service (MaaS).

The transit ticketing industry is changing as more agencies move away from physically issuing tickets to using mobile phones and contactless bank cards, allowing riders to simply tap and ride to travel, the report notes.

“This has led to limited innovation with some agencies able to purchase the latest systems but leaving many underserved and left with systems that are outdated”

While the research found that account-based ticketing and extending services to seamlessly connect public and private transit options to enable full first/last mile journeys is a focus for most transit agencies, bespoke core AFC systems are leaving many transit agencies unable to keep up with the pace of technology change.

 

“The results of the survey are both shocking and unsurprising. For too long transit agencies have been denied access to systems that can keep up with technology in a cost-effective way and have been forced to invest in costly and bespoke AFC system. This has led to limited innovation with some agencies able to purchase the latest systems but leaving many underserved and left with systems that are outdated. This isn’t fair to passengers; public transit riders and agencies deserve better,” said Brian Zanghi, CEO of Masabi.

 

“The message from this research is clear – it’s time for a fare payments revolution, so people in any town or city have the opportunity to enjoy the best journey experience from their transit providers.”

 

According to Masabi, fare payments-as-a-service (FPaaS) offers a better approach to underserved agencies wanting to provide the latest fare payment services for passengers.

 

Instead of needing to run a bespoke project that is designed, built, operated and maintained exclusively for and by the agency, public transit operators can instead sign up to a fare payments platform and pay for services on a pay-as-you-go/subscription basis. This enables agencies to deliver the latest tap and ride innovations to riders extremely quickly and grow capabilities as they get released onto the platform, it said.

 

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