Transit Insights: Is Transit ready for the contactless payments revolution?

Translink explains how it will bring cutting edge fare collection to public transport in Northern Ireland.

By Creditcall

There’s a revolution taking place in the transportation industry. It began in London where mass transit travelers using the tube and buses across the city now can pay for their fares using their own bank-issued contactless debit and credit cards. This wasn’t always the case. Prior to a few years ago, the only way to get around London was by purchasing traditional tickets or using TFL’s closed user group Oyster cards.

What’s driving this change?

The benefits have exceeded expectations. First, accessing public transportation is easier with the open loop system for tourists not familiar with the ticket process and proprietary Oyster scheme. Also, changing to an open payment system has reduced the overhead of managing the closed group cards. It’s not surprising that almost every other major operator in the UK and across Europe is looking at ways to implement similar schemes. Those who have already piloted open loop payment cite customer service, simplicity, reduced costs and risks associated with cash collection as key reasons for upgrading.

Additionally, using the latest generation payment methods (such as contactless EMV) has sped up the boarding process on buses and trains and helped them stay on schedule.

It’s clear that ticketing and the ways customers pay, is changing. Unfortunately for transportation companies, the path to change isn’t necessarily clear or easy.

It’s clear that ticketing and the ways customers pay, is changing. Unfortunately for transportation companies, the path to change isn’t necessarily clear or easy.

With the London project showing clear ROI, not just private operators but other UK municipalities and organizations have been eager to update their payment infrastructure. One such organization is Translink, a public corporation established to deliver the provision of public transport in Northern Ireland. The journey and pursuit of upgrading its ticketing and payment infrastructure shows how challenging this endeavor can be.

Build the perfect ticketing payment system

Initially, the impetus behind Translink’s upgrade — which began in 2012 as part of a pre-project process – was to replace outdated technology. Translink were one of the first public transport operators in the UK to implement smartcard ticketing on all of their bus and rail services but that was back in 2002 so their system needs to be refreshed to provide a platform for modern technologies and payments. According to John Keys, Treasury Department Manager for Translink, most of the company’s current ticketing system and equipment (aside from the Rail Handheld ticket machines which were replaced in October 2014) are more than 15 years old, with faults increasing and component parts becoming obsolete. Fearing that it will soon no longer be economically viable to maintain the current ticketing system, Translink sought to implement a new ticketing system. After researching new capabilities, having detailed discussions with their existing payments processors/acquirers, and piggy-backing on the learnings of the London project, Translink’s system specification grew to incorporate a number of significant enhancements and latest-generation capabilities. In fact, the specification document was 880 pages long, with 100 pages specifically regarding contactless EMV payments.

“We weren’t looking for a supplier who could check the most boxes off our wish list, We wanted a complete solution with full end-to-end capabilities. That was Parkeon.” – John Keys, Treasury Department Manager for Translink

After putting the project out to tender, Translink had 11 suppliers interested in the project. Translink narrowed it down to five. Ultimately, towards end of 2016, Translink awarded the work to Parkeon, a European-based transit specialist with systems in more than 3,500 cities across 55 countries. Keys says Parkeon was the most comprehensive solution offered.

“We weren’t looking for a supplier who could check the most boxes off our wish list,” says Keys.” We wanted a complete solution with full end-to-end capabilities. That was Parkeon.”

To handle much of the payment components of its solution and help them win this tender, Parkeon has a close partnership with payment gateway and EMV kernel provider Creditcall. As a subcontractor on the project, Translink also vetted the Payment Gateway through their evaluation process.

“Creditcall’s name showed up on a number of bids, which showed us that they were clearly innovators and leaders when it came to true omni-channel, EMV, contactless, and validated P2PE solutions,” – John Keys

Translink wanted a payment partner that was acquirer and processor agnostic. The gateway also needed contactless EMV experience. Creditcall met these criteria. It also helped that the company had experience with mobile POS, ticketing vending machines, face-to-face retail, contactless EMV, and in-app payments. “Creditcall’s name showed up on a number of bids, which showed us that they were clearly innovators and leaders when it came to true omni-channel, EMV, contactless, and validated P2PE solutions,” explains Keys.

With the technology supplier and its payment subcontractor appointed, the upgrade project could finally begin.

Translink’s planned upgrades and enhancements

Creditcall’s platform provides consistent tokenization, it doesn’t matter what method a customer uses to purchase a ticket, online, mobile or self-service, Translink will be able to get a “Big Data” picture of cardholder habits and purchases.

Following is an abbreviated list of planned upgrades and enhancements that will happen over the next few years:

• Hundreds of devices from Parkeon will replace outdated equipment on buses and trains, including introduction of approximately 280 ticketing vending machines across Northern Ireland. By leveraging Creditcall technology, contactless EMV and card payments will be accepted and secured through a PCI validated P2PE solution — in addition to the existing closed loop smartcards.
• Revenue Protection officers on trains and buses require mobile point of sale (mPOS) units. Parkeon worked with Creditcall to identify Miura Systems M010 payment terminals to be used with these portable handheld devices for mobile payments.
• Translink already have an existing mobile ticketing application with 13,000 registered users. As part of the new project, additional functionality will be delivered to customers to pay for their smartcard top-ups within the mobile app. In addition to seamless switch over to Creditcall, app users will gain the ability to pay with Apple Pay and Android Pay.
• Since Creditcall’s platform provides consistent tokenization, it doesn’t matter what method a customer uses to purchase a ticket, online, mobile or self-service, Translink will be able to get a “Big Data” picture of cardholder habits and purchases.

Translink currently facilitates approximately 80 million journeys each year. It also has 480,000 smartcards being used on its bus and rail services on a daily basis. This project is a critical business change project and a very significant undertaking, but one the company is sure will pay off.

Just getting started, Translink, Parkeon, and Creditcall have an open, productive working relationship today that’s driving the project forward toward success. Still, some aspects of the project, due to their implementation later in the process, are still being debated.

For example, Keys says Translink is currently weighing the merits of a single fare (known to the UK market as model 1) versus a “tap on, tap off” aggregated fare (known to the UK market as model 2). Thanks to Parkeon and Creditcall’s expertise in the transportation market, either can be implemented, including the technologically complex model 2.

Translink currently facilitates approximately 80 million journeys each year. It also has 480,000 smartcards being used on its bus and rail services on a daily basis. This project is a critical business change project and a very significant undertaking, but one the company is sure will pay off.

New technology will allow customers to use existing closed loop cards or pay with their own debit and credit cards — including contactless EMV. Customers will find more payment options when using the app or paying online. The number of customers should increase, while the time to board buses decreases.

Conclusion

Despite just getting under way with the new project, Translink is moving apace with other leaders in the transportation industry. As other municipalities and countries come to the realization that open loop payments are ideal and bring many benefits, they too will begin their journey. Thanks to the arduous work of pioneers like Transport for London (TFL), Translink, Parkeon, and Creditcall, there are now answers to the difficult challenges others will face.

We’ll be exhibiting at APTA at the Georgia World Congress Centre in Atlanta on October 9-11, 2017 on booth #4150. We look forward to seeing you there!

Images courtesy of Translink.

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