Debit & Prepaid

Chicago Transit Approves An Open Fare-Collection System

This story has been updated from its original version.

The Chicago Transit Authority’s board on Nov. 15 approved a 12-year contract with Cubic Transportation Systems Inc. to install an electronic fare-collection system that would accept open-loop contactless card and mobile payments.

The agency first announced its plans to revamp its fare-collection system last year and had been considering proposals through August (see story).

Daniel Schwen

Cubic installed Chicago’s existing fare equipment in 1997. The system now supports a magnetic stripe card, a contactless closed-loop card and cash. Cubic’s 12-year contract with Chicago is worth $454 million, according to a report in the Chicago Tribune.

Cubic declined to comment on the purported deal until it becomes official. The transit agency similarly declined further comment until a deal is reached.

The authority previously said it would own all of the fare equipment installed by the selected vendor and maintain control over the fare amounts. The agency now charges $2.25 for a single ride. Passes are available for unlimited use during a certain time period. An all-day pass costs $5.75. A three-day pass costs $14, while a seven-day pass is $23. A 30-day pass costs $86. Some 1.6 million commuters use the authority’s bus and trains daily.

Besides contactless credit and debit cards, commuters may purchase contactless prepaid cards at more than 1,000 retail and station locations. The authority’s buses would still accept cash under the new deal.

The Chicago area is in the midst of reworking its transit fare collection system.

Gov. Pat Quinn signed legislation July 7 that requires the Chicago Transit Authority, commuter rail system Metra and suburban bus system Pace to develop a universal fare card. The Regional Transportation Authority oversees the systems (see story).

The bill requires the authority to develop a system that enables commuters to use contactless credit, debit and prepaid cards.

The regional authority helped draft the legislation and already was working with the transit agencies on a new system, John S. Gates Jr., the organization’s chairman, said in a statement in July.

Chicago expects the new system to be operational in late 2013 or early 2014.

New York, Philadelphia and Washington, D.C., are among several cities seeking to adopt similar open-fare transit systems.

Philadelphia is conducting a test of an open transit payment card system along a 14-mile commuter rail line near the city (see story). The Port Authority Transit Corp. system is using a bank-issued, reloadable prepaid card containing a contactless chip from Wilmington, Del.-based The Bancorp Bank in the trial.

The Washington Metropolitan Area Transit Authority is in the process of accepting proposals from technology companies to replace its closed-loop system.

Three New York transit agencies last year tested an open-loop contactless system that used MasterCard Worldwide technology (see story).

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