AP Photo/Mary Altaffer
- The New York City subway will soon have something much of the world has had for years: tap-to-pay fares.
- The new OMNY system will debut on May 31, and roll out to the entire system by 2021.
- Despite its ease of use, most Americans don’t have contactless cards yet. Visa and Chase are trying to change that.
Americans who have travelled abroad have likely gotten a taste of what transportation could be like.
In London, for example, a simple tap — of an Oyster card or your credit card — gets you through onto the Tube. The same is also true in Hong Kong, Singapore, Santiago, Chile and other cities across the world.
But New York, the US’s largest transportation system, like in other technologies, has been slow to catch up. The subway system, after all, only ditched physical tokens for fare payment in 2003. That’s finally going to change.
Starting on May 31, New Yorkers at certain stations on the system’s busiest line — including at the iconic Grand Central Terminal — will be able to tap their contactless credit cards to pay their fare. Over the next two years, the technology will eventually roll out to all of the city’s 472 stations and 5,700 buses routes by 2021, the MTA is targeting.
But there’s one glaring problem: most US consumers don’t have contactless cards.
AP Photo / Mary Altaffer
Only about five percent of the roughly 480 million cards in service in the United States had contactless payment technology in 2017, according to research by ATKearney. What’s more, they only make up about 0.18% of all transactions.
That’s an issue Visa and Chase are trying to tackle together.
Their first move: issuing cards with the new contactless capabilities as quickly as third party issuers are able to churn them out.
"Right now we have roughly close to 20 million cards, give or take, in the market and every week we keep adding more," Abeer Bhatia, president of Card Marketing, Pricing and Innovation at Chase, told reporters at a media event this week.
"By the end of the year we should have about half our credit cards contactless and debit cards are going to start sometime this summer. By the end of 2020 we should be nearing 70 to 80 million credit cards in the marketplace that are contactless."
Things are starting to change.
Graham Rapier / Business Insider
Eighty of the US’s top 100 merchants have contactless systems in place, Visa estimates, with 11 of the top 25 card issuers now rolling out contactless cards.
That means there’s plenty of room for American consumers to catch up with the rest of the world, where 48% of all face-to-face Visa transactions occur via contactless taps, Visa says.
No more headaches on morning commutes.
Graham Rapier / Business Insider
Two-thirds of the riders surveyed by Visa said they had forgotten funds on a transit card. For example, if you added $20 to a MetroCard, only to swipe for seven rides, and accidentally throw away the extra $0.75.
Now, instead of loading a MetroCard for pay-per-ride fares, New Yorkers can simply tap their contactless credit card to pay their fare and ride the subway. That means no waiting in line for a vending machine, which has a pretty solid chance of being out-of-order or cash-only. (MTA booth employees notably can’t accept credit card payments.)
See the rest of the story at Business Insider
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Source: Business Insider – grapier@businessinsider.com (Graham Rapier)