The Smart Card Alliance Transportation Council held a web briefing held in late July to discuss projects it was embarking upon to facilitate the use of contactless smart card technology in the transit sector.
The council was created in combination with the American Public Transportation Association (APTA). Its interim co-chairs are Greg Garback, Washington Metropolitan Area Transit Authority, and Mike Dinning, U.S. Department of Transportation/Volpe Center. The co-chairs were joined at the briefing by representatives from several transit and payment companies that are council members.
“To better serve the vertical markets, we created industry councils, with transportation being one of them to serve as a forum for transit and other transportation services,” explained SCA’s executive director, Randy Vanderhoof. Other councils created by the alliance include one for healthcare and another for physical access. He said the goal of the council is to serve as a forum to promote the adoption of contactless smart card payment systems for transit and other transportation services.
Mr. Garback said there were about 9.6 billion transit trips in 2004, a 2% growth year-to-year with a higher growth rate expected this year, and that some $20 billion a year is collected annually in fares. “Parking is another $20 billion marketplace,” he added. “What we’re discovering are two key value propositions: for consumers, speed and convenience, and for agencies, operational efficiencies.”
He said the council’s goals and objectives include stimulating an understanding and acceptance of smart cards, serving as a technical resource for the marketplace, and providing educational and research resources for the industry.
A range of contactless deliverables
Speakers touched on council projects, either in process or planned, such as:
- facilitating parking payments,
- developing a “trust model” for clearing transactions between closed payment systems,
- increasing security, and
- integrating other payment systems into public transportation systems.
David deKozan, vice president and general manager for Cubic Parking Systems, said, “security is becoming a greater concern, particularly for public venues such as airports, transport centers, and event facilities. We’re living in a dangerous world these days.” Fraud is still a significant issue in the parking arena, with fraudulent credit card usage, employee theft, and vandalism, some due to lack of audit controls, he said.
“Contactless smart card technology is an ideal payment medium for parking applications” particularly with the compatible contactless credit cards that are being issued by banks, said Mr. deKozan.
Accepting “other” payments in a fare collection system
“We’re pulling together a group paper to explore smart cards in parking, current trends in the parking and transit sectors, and the benefits available,” he added. The final paper is scheduled for release Oct. 1 and he concluded with a plea for parking operator participation.
The “trust model” project is designed to build a set of rules and processes regarding acceptance of existing payment technologies without a significant investment in transaction processing systems, said Willy Dommen, principal in Booz Allen Hamilton. “We want to minimize this, make it work with a low investment.”
Potential participants in this project include transportation agencies (public transit, toll collection, parking), financial institutions and retail merchants.
“Operating rules will take the most significant effort, how the card issuer is to behave, what the merchant is to do, dispute resolutions, customer service,” he added. “Two critical elements are security, and privacy – we haven’t had to really deal with this but it will become more of an issue.”
Expanding a nationwide standard for fare collection in the U.S.
Another project mentioned was the APTA/UTFS (Universal Transit Farecard Standards) Security White Paper. Tim Weisenberger, electronic payments and transportation analyst for the U.S. Department of Transportation’s Volpe Center, explained that this paper “is an ongoing partnership with APTA to support their universal fare standard program. The goal is to achieve regional and even national interoperability throughout North America.”
The first project will examine the move towards fare system security standards. “We’re currently in development of fare security guidelines. Our group wanted to focus on finalizing specifications and it should be ready by the fall of this year.”
The paper could benefit both the transit industry by outlining an industry-wide security specification and helping achieve interoperability among closed smart card fare payment systems and the smart card industry by leading to further smart card adoptions among the various transit agencies.
Getting involved …
Mr. Garback summarized: “We’re looking for a broad-based membership (on the council) from the public sector, contractors, private firms and academicians. We’re looking to put some more flesh on the bones as to what the organization is going to look like…and we want to push towards development of these projects.”
“I appreciate the support the alliance has given us to facilitate this launch,” said Mr. Garback as he explained the council’s goals and objectives and gave listeners an overview of the U.S. transportation market. To access the briefing presentations from this web conference, click here.