Around the world, cities are taking decisive steps to help make their urban mobility ecosystems frictionless, sustainable, and inclusive. For many of them, implementing contactless, open-loop payment systems is a crucial part of this process. This paper presents results from a survey of 75 transit agencies and 3,000 transit riders from cities around the globe, and concludes that contactless, open-loop payments help to reduce carbon emissions and promote financial inclusion—among other important benefits.
Digital payment in transportation networks can be implemented on open-loop or closed-loop systems. Openloop payment systems use international standards and universal technology to enable payments at most transit providers. Closed-loop systems are limited to particular providers and usually apply specific standards and proprietary technology.
To understand the benefits of open-loop systems, the Visa Economic Empowerment Institute (VEEI) partnered with ThoughtLab, a global research firm, to survey 75 transit agencies and 3,000 transit riders from cities around the globe. Together, we found that transit systems offering contactless, open-loop payments provide widespread benefits to riders, agencies, and cities. Among other benefits, 80 percent of transit agencies in our survey that had already implemented these systems saw increased ridership following adoption. Agencies that had adopted open-loop payments less than two years ago saw an average total increase of 6 percent, while agencies with two or more years of experience saw an average increase of 10 percent. This paper explores the findings of our survey, and concludes that contactless, openloop payments help to reduce carbon emissions and promote financial inclusion.