Distribution Fare Media through Retail Networks in Card Based Systems. Craig Roberts Director, Tolling and Transit InComm

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1 Distribution Fare Media through Retail Networks in Card Based Systems Craig Roberts Director, Tolling and Transit InComm April 13, 2016

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3 A Growing Need Who are they The un and under banked The occasional customer Cash preferred.because..? Short term residents Travelers & Vacationers How to help them Allow the customers to control how and when they pay Provide options so they can manage their accounts Allow for anonymous accounts but incentivize them to register Provide an easy and convenient way for customers to purchase Fare Media 3

4 The Prepaid Transit Card Offers an open denomination load limited to a minimum and maximum value Customers simply TAP the card on the reader as they enter and or exit. Real-time transactions and account updates Universally reloadable at any participating merchant and across multiple channels 4

5 Purchasing A New Card 1. A first-time customer enters one of our participating retailers, removes a new branded fare media smart card from the display, and brings that card to the cashier. 2. The customer requests to load a specific dollar value on the card and hands it to the cashier. 3. The cashier swipes or scans the package and enters the value requested into the register. 4. After the customer has made payment for the load amount plus the onetime fee to purchase the card, a message is sent back to prepaid program manager requesting authorization to complete the transaction. 5. A second message is returned to the retailer confirming that the transaction was successful 6. The customer can now leave the store and jump on the bus or train knowing that the card has been activated and the funds have been loaded on their account 7. The prepaid program manager s back office immediately communicates with agency s real time validation server so that its readers on buses and inspection devices know that the card is valid. 5

6 Cards and Packaging All sales are final, card is not refundable 6

7 Industry Interest Demonstrated with the Utah Transit Authority s FAREPAY card in 2013 Specified for new fare collection systems in Oregon, Philadelphia, Washington, DC, Buffalo, Connecticut, Florida, New York and Dallas These new open payment systems use an account based architecture 7

8 Account Based Architecture Activation of cards and stored value associated with them is undertaken in the back office Cards on a retail merchant s racks are worthless until they are activated at the retailer s Point of Sale (POS) registers 8

9 Card Based Architecture Fare balances and products carried on the smart card Activation and load/reload requires specialized devices Not compatible with retailers systems cards cannot be sold and activated at every checkout register Tends to be both costly and inconvenient for the agency and the merchant 9

10 Card Based Architecture Deployments Atlanta Boston Houston Los Angeles Miami Minneapolis San Diego San Francisco Seattle Washington, D.C 10

11 Challenge Achieve fare media distribution via gift card racks and retailer point of sale registers for card based systems. 11

12 One Approach Card based system to be modified or adapted: 1. Cards pre-activated at the chip with no stored value balance would be packaged for distribution on retailers J-hook racks. 2. The cards and packaging would be printed with bar codes and magnetic stipes so that they would work on various retailers POS systems. 3. Agency fare acceptance validators would be programed such that they would not accept any of these cards unless they appear on a list sent to them after sale at retail. 4. Validators must be able to load value to the cards. 5. Validators optimally should have real-time communications to the agency back office. 12

13 Use Case 1. Customer takes card from prepaid product rack and hands to the clerk. [Card has no value on the rack and cannot have value added outside store and used for fare payment until added to list on validator.] 2. Clerk queues card in POS system to accept payment for card sale with the requested load amount, accepts tender and transmits the transaction to the prepaid program manager s back office. 3. The prepaid program manager sends instructions to the agency s back office to accept the card and to load the designated value onto the card and card account. [The prepaid program manager settles amounts collected minus commissions to the agency.] 4. Agency sends instructions to all validators to accept the card and add the designated value. 5. Customer presents card to bus or platform validator which is accepted for fare payment. 6. Customer may add more value to the card through retail, on-line or at agency kiosks. 13

14 Caveat If reliable real-time communications cannot be achieved to all buses and platforms, customers would need to accept a delay in being able to use the cards after retail purchase. Bold warnings on packaging would be warranted alerting purchasers that cards may not be available for use earlier than 24 [48?] hours from sale. 14

15 Thank you. Craig Roberts Director, Tolling and Transit