presto efare system - american public … into an easier commute. tap into march 28-30, 2011 presto...
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Tap into an easier commute. Tap into
March 28-30, 2011
PRESTO eFare System
APTA Fare Collection WorkshopSession 102
March 2011
Tap into an easier commute. Tap into
Outline
PRESTO Status Update
PRESTO’s 2020 Vision: A Future of True Mobility
Client Choice & Convenience
Getting There: PRESTO Next Generation
PRESTO Point of View on Open Payments
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Device and vehicle installations:
3600 devices/ 1600 buses/ 220 sites
12 TTC subway stations
Municipal Service Provider Rollout:
7 regional municipal transit agencies (May 2011)
Regional rail lines (April 2011)
Regional commuter buses (June 2011)
Ottawa/Carleton (OC Transpo) including 1200 buses
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PRESTO Deployment Status
In revenue operations since October 2009
A ‘passive’ approach to card adoption during rollout
$14M total in e-purse loads
$12.5M total in fare payments
26,000 cards in active use (growing by 1500 per week)
High customer satisfaction with PRESTO:
91% felt that PRESTO is beneficial to them
90% would recommend PRESTO to fellow transit users
TTC ridership will increase as more 905 Service Providers go-live with PRESTO in coming weeks
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PRESTO Current Operations
PRESTO’s 2020 Vision: A Future of True Mobility
True Mobility
True Customer
Choice
True Value to Providers
Social & Economic
Policy
Commercialization
Information Management
True Mobility means more than just commuting. Analysis of local issues and industry trends
demonstrates that Commercialization, Information Management and Social Policy will drive change
and create True Customer Choice and True Value to Providers
“PRESTO Vision 2020 White Paper”
True mobility providing true choice
Integrated service model delivering a holistic and convenient travel experience to customers
Open and flexible system
Progressive technology roadmap
New opportunities for revenue management to providers
Achieving strong economic returns through the smart useof technology and commercial partnerships
Embedded information management capability
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PRESTO’s 2020 Vision A Future of True Mobility
As of March 2011
Choice of Integrated
Transit
Choice of Payment Channels
Choice of Product &
Service
Choice of Access to
Information
Use PRESTO services across transport modes/ and operators (public/private)
Supporting Client Choice & Convenience
PRESTO’s Vision of True Mobility will provide expanded choice and convenience to customers who
have different needs and preferences
Access information from multiple interfaces
Anytime; anywhere; anyplace
Solutions that are low-cost and affordable
Single or multi-ride, pass, stored value
Options on how to pay and use transit
Credit card, debit card, mobile, PRESTO card
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Key principles that PRESTO has outlined for its transit fare system which also shape
PRESTO’s approach for PNG and open payments
Flexible
Cost
Leading Edge
Customer Focus
Choosing a solution that is financially attractive in the long term and which is cognizant of the payment industry financial model
Developing a solution that is flexible and can be changed and upgraded over time
Developing a solution the transit provider has control over the system and which doesn’t cede control
Developing a solution that leverages the latest technological advances in payment technology and which develop commercial partnerships
Developing a solution that focuses on the customer and provides choice, convenience and access to all
PRESTO Key Principles
Control
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PNG is open architecture using industry-standard tools and products, to create an open and non-
proprietary system
PRESTO Next Generation
PRESTO Next Generation (PNG)
PNG challenges farecard industry single vendor proprietary fare systems (both closed or open payment system)
Standard tools not proprietary or closed software solutions
Open architecture (open, flexible, non-proprietary design)
Abstraction layers providing open & flexible design
Delivers multiple payment types and open for future innovations – open payments, mobile, cloud-based accounts
Multi-vendor sourcing –multiple vendors and device types
Does not cede control to the payments industry or vendors
Progressive technology roadmap
Built from existing Central System assets that are compatible (e.g. interfaces, settlement, clearing, back office), replace those which are not
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Transit Operators
Benefits PNG Provides
Support new business requirements
Faster and lower-cost changes
New products and services (e.g. Smog day)
New revenue (transit/non transit)
Choice and convenience on how to pay for transit – e.g. mobile, open payment
Choice of fare products & services
Access to information anytime, anywhere
Meet expectations for service enhancements
Integrate transit & transportation investments
Promote regional interoperability
Accessibility
Prudent fiscal management
Technology refresh strategy
Operations and Service Delivery
Customers
Public/private partnerships – e.g. city cards, retailers, telcos
Improved information management and analytics
Flexible cost effective changes
Focus on holistic travel experience
Complementary products & services
Universal accessibility
Cost effective services
Build on existing PRESTO investment
Build on PRESTO managed service operations
Permit public/private partnerships
Public & private revenue generation
PNG supports these common TTC/City/Province/Metrolinx outcomes through an open, flexible,
scalable non-proprietary design
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PRESTO’s decision to support open payments within PRESTO is based on the following
Open payments should be another choice for customer - it should not be the only choice
Subscribing to a full open payment model would cede control from the transit operator and fare collection agency
Supporting open payments on terms which make sense for customers and operators
The need for an open, flexible and non-proprietary back-end system is critically important for open and closed e-fare transit system
Payment Industry is going through rapid transformation (both business and technology led). Transit payment solutions need to be flexible to adopt to this change
Realities of the payment industry (see next slide)
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PRESTO and Open Payments
Payment industry context for proposed open payment solutions
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Only ~5% of the cards today in Canada have contactless payment capability - this is expected to grow to nearly 80%, but over 10 years, by 2020
Consumer preference studies have shown 55% of transit commuters prefer using a dedicated transit card; 30% prefer open payment bank cards; 15% prefer conventional tickets and passes.
The payment rate for credit cards in Canada is 30%. This means that 70% of Canadians carry balances on their credit card. In US the payment rate is 15% (or 85% carry balances)
Consumer debt in Canada is at an all time high with rising debt-to-income ratios
Card companies make 99% (62% from revolvers (only carry balance) and 37% from transvolvers (carry balances and transact) of their profit from customers who carry balances and only 1% from consumers who pay their bills on time
Debit Cards have fees for the consumer (typically $0.35 / transaction - charged by the bank) and merchant (typically $0.12 / transaction charged by Interac). Credit Cards have fees only for the merchant (typically 2 - 3% of transaction value). Consumers would hence prefer using credit, while merchants prefer debit.
The use of general purpose reloadable cards has many hidden fees which can make these solutions expensive for transit users when compared to PRESTO. Also the GPR market is immature in Canada, and in the US regulatory issues are still being resolved
PRESTO and Open Payments
Evaluation payment systems must evaluate equivalent capital and operating costs and the
total cost of ownership. Typically a COTS solution may appear less expensive, but have
higher long term costs for operations and inevitable changes
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Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10Year 11Year 12Year 13Year 14Year 15Year 16Year 17Year 18Year 19Year 20
Illustrative
PRESTO’s PNG Approach
Full open payment system
There is higher Capital Cost for a self developed transit
payment system
Higher Ongoing costs make an outsourced transit system more
expensive in the future
Total Cost of Ownership
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