Consult Hyperion has been working with Transport for London (TfL), the local government body responsible for most aspects of the transport system in Greater London, to prepare for the launch of contactless bank card ticketing.
The first phase of the project will begin with bus passengers, who will have the option of paying their single bus fares using a contactless debit or credit card on London’s buses in mid-December. This payment option will then be rolled out to the rest of the transport network, including the Tube, Docklands Light Railway (DLR), Tram and London Overground Network. Discussions are also well advanced with the Train Operating Companies about accepting contactless debit and credit cards on National Rail services where Oyster is currently accepted.
The opportunity to use contactless debit and credit cards will offer much greater convenience for passengers who travel in London, since they’ll be able to use a card that they already have, instead of having to carry and top-up an Oyster card, and will not need to take any action before they travel.
Contactless ticketing will also help to reduce the production and distribution costs connected with traditional paper-based and smart card ticketing channels, and will also provide customers with a simple, secure and convenient way of purchasing tickets.
For a project of this scale, the ability to bring the relevant processing, communications and security technologies together successfully required knowledge not only of the abilities and constraints of the technology, but also the longer-term business ramifications of any decisions that are made during the early stages of planning. As such, Consult Hyperion played a key role in reviewing the project’s overall design specifications and technology requirements in detail.
During this planning phase, it was clear that certain aspects of the existing Oyster network would be valuable to retain as part of the upgrade. For example, Pay As You Go (PAYG) travel with daily capping has proven to be a popular model that eliminates deliberate ticket purchase as a barrier to travel and thus drives up ridership.
By comparison, the way in which the existing Oyster scheme stores data on the card has historically made it difficult to accurately offer customer information online. Likewise, a ‘stored value’ card like Oyster requires passengers to invest time in managing PAYG balances and season ticket expiry dates, which can be inconvenient for ‘non-commuters’ who don’t travel every day. As such, both of these issues needed to be considered when deciding upon any new payment options.
Consult Hyperion also needed to overcome a number of challenges related to the transaction speed that contactless debit and credit cards could accommodate, since even very small delays can quickly cause congestion.
Oyster transactions, for example, can now be completed in 300 to 350 milliseconds. This processing time is very fast compared to swiping a paper ticket with a magnetic stripe on the back, which has a benchmark of 750ms. As such, it is important to maintain this minimum speed requirement of 350ms for high volume use, and yet most of today’s contactless debit and credit card technology typically transacts at around 500ms, largely because of the added security features that these cards have.
Consult Hyperion conducted sophisticated prototyping work in order to show how TfL’s card readers could be made to work with contactless payment cards both securely and effectively. The card readers across the TfL network were already planned to be upgraded to recognise cards based on ITSO, the transit smart card standard backed by the Department for Transport. Consult Hyperion added to the design of the upgrade to also accept contactless payments via credit and debit cards so that the funds could be drawn from a bank account, rather than only being deducted from a card with a stored balance.
These new payment models have already been approved by all the major payment schemes and will make full use of the payments industry’s most up-to-date security systems, as they need to meet not only the internal requirements set by transport operators, but also the security requirements of the global financial services industry.
Consult Hyperion therefore helped to identify a number of important controls in order to guarantee the most appropriate security. For example, the international payment schemes use a standard called PCI-DSS to set out the requirements for merchants accepting credit and debit card transactions, and heavy merchant fines are associated with any breach of these requirements. As a result, the requirements of PCI-DSS have been driving much of the security design of the new contactless system.
In addition to PCI-DSS, Consult Hyperion has been working with transport operators, Visa, MasterCard and American Express in order to ensure that the security controls of this new system are fit for purpose and proportionate, and also conducted further prototyping work to ensure that the security controls wouldn’t have a negative impact on the performance of the system.
The new system will also mark a shift in emphasis from the ‘front lines’ to the back office. Ticketing logic will migrate away from the card and card readers and to the back office instead. When a payment card is touched in or out, transactions will simply be collected throughout the day and journey fares calculated in the back office at the end of each day. This will eventually deliver a massive simplification at the reader end, since complex fare tables will no longer need to be held nor used at the card readers.
Once this upgrade is completed, the Oyster system will be able to recognise contactless debit and credit cards issued by Visa, MasterCard and American Express – as well as Oyster and ITSO cards – wherever Oyster is currently accepted on TfL and National Rail services.
Also, plans are in place to enhance online customer accounts to make it even easier for passengers to see information about their travel history, their account and also query and make payments. Certain features of contactless payments will also be adapted to suit the public transport environment. For example, customers will never need to enter a PIN at the gate line or bus reader.
By utilising this “contactless” environment, transport providers will thus be able to benefit from significant operational and cost savings, since cash-handling costs will be reduced as well as smart card issuance costs (due to more people using bank-issued payment cards). Not only is the cost of collecting, transporting and securing cash significant, the ability to minimise the use of cash will also reduce the risk of theft, particularly from buses.
Future developments of the system relate to the technology within contactless debit and credit cards. According to Consult Hyperion, contactless debit and credit card chips could soon have a Transit Data Area (TDA) added which will allow card readers to write transit data to the card so that a customer’s validity to travel can be checked more easily. Technological developments like these are continuing to drive progress in this area, thanks to the strategic collaboration between some of the world’s leading mobile technology developers, smart card manufacturers, service providers, and standards bodies.