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Data for today’s episode is provided by Mercator Advisory Group’s Viewpoint: Commuters Win with the Evolution of Transit Payments
The COVID-19 Pandemic Has Profoundly Influenced Transit Payments:
- Nationally, transit ridership declined by 73% and fare revenues were down 86% in April 2020 compared to April 2019.
- In April 2021, ridership was still down 50% from April 2019.
- To draw ridership back, transit systems will need to impress upon the general public that mass transit is safe.
- Frictionless payments, including the move toward contactless, will be a part of achieving these goals.
- The shift to contactless payments for transit has accelerated due to the pandemic.
- The use of Google Pay for transit has increased by 30% in 2021, even as overall ridership is just now beginning to recover.
- Over 80 transit systems in the United States alone accept Google Pay as a payment method.
Transit payments are becoming faster, digital, and contact-free.
Paying for transportation runs the gamut from cash and checks to modern, contactless mobile apps that let riders pre-plan and pre-pay for trips. Financial institutions have an opportunity to support the millions of riders in the U.S. that use mass transit and other forms of transportation that constitute billions of payment transactions annually. The new mobile-based transit payment apps are not only digitizing cash and check payments at the fare box, but extending to mobile payments for other purchases along the journey.