Why contactless technology adoption needs to accelerate

The public transportation landscape has been at a standstill until recently. This past year the pandemic has created a significant demand for contactless or distanced services. From curbside pickup to contactless deliveries, every industry has been impacted in one way or another. However, when it comes to public infrastructure like public transit, little has been done to ensure services remain in place while adhering to COVID guidelines and new social norms. This has left the industry in a precarious position, with dwindling users and staff that are apprehensive to come into work.

Over the last few years, consumers have had a heavy impact on changes in multiple different industries and that demand has now reached the public sphere. Transit agencies are being called, by various pressures and attractive incentives, to step up and transform their industry.

During the height of the pandemic, a handful of cities already started redefining public transformation. Public transit agencies are adjusting their resources to address the communities' concerns. For most, the apprehension lies in the physical transaction of handling money to pay for fares.

Researchers have found that cash can carry flu viruses for up to 17 days, and while this number can be terrifying to passengers and transit workers, an easy solution comes to mind. With essential workers and transit workers still using public transportation on a daily basis, cities have had no choice but to make safety their number one priority. The majority of cities that are making these changes are turning to mobile ticketing as an easy solution. Contactless payments are already being used in retail, and other industries, and present a simple option for users to avoid using physical money altogether.

This past year alone, adoption rates for contactless technology have soared, and it's become a mainstay for most financial transactions. Now, 40% of Americans are using cash less frequently, and two out of three consumers would buy from companies that offer contactless payment options. With a wide adoption rate across industries such as retail, food and dining, online learning, entertainment, and healthcare, contactless and distanced services are now a customer expectation. Those cities that fail to implement these changes early, will find themselves trying to keep up with the transformed cityscape.

Pressure and benefits

With consumer-led and pandemic pressures seemingly at the forefront of change, there are also considerable benefits to making the transition into smart technology. Implementing contactless technology will satisfy existing passengers while also attracting a new wave of riders. Recent studies indicate that younger generations are more likely to use public transportation if they can use convenient and tech-capable services. In fact, in some cities, the highest adoption rates come from millennials and gen Z users, both as new and existing riders. Transit agencies can also use contactless technology to increase their ridership numbers by tapping into multi-modal options. The efficiency and ease of integrating mobile ticketing into existing systems such as e-scooters, park and ride facilities, and railways can incentivize riders to expand their commute possibilities and travel with multiple-modes.

Smart technologies can also drastically reduce costs for transit agencies by eliminating the need for cash fareboxes. These boxes are costly pieces of equipment, require regular maintenance and upkeep, and are not equipped to provide real-time data insights on ridership, or be used without contact and without additional proprietary technology. Instead, using electronic validators to collect fares, authorities can cover all bases with one piece of technology. Fares are collected without contact, data is gathered on the number of riders, and the location of the vehicle is logged to automatically update schedules. A smaller bottom line and a more efficient system can be the push cities need to advance their current system into the new era.

In this modern day, cities around the globe are faced with many reasons to transition to contactless technology, and external and internal pressures are making that decision more attractive, and in some cases, necessary. In 2020, pressure from the pandemic has raised hygiene concerns over handling cash, and physical fares, and with consumers now expecting to see distanced and contactless services in every interaction, the need to innovate public transit has never been greater.

What might seem an intimidating task at first can be the saving grace of public transportation and help revive the industry by bringing users back on board. Not only can the technology cut costs for public transit agencies, but it also opens new avenues for users to travel conveniently, across multiple modes, in a city. For early adopters of the technology, such as Lancaster and Reading, Pennsylvania, increased ridership can be expected, and new users may now find public transit a more viable and accessible option.

In these unprecedented times, adopting contactless technology is no longer a question of why, but when.