Dive Brief:

• Visa and smart card technology company Planeta Informatica have jointly released technology for contactless payments at transit turnstiles. Visa Secure Access Module (SAM) allows passengers to tap to pay fares with a contactless card, phone or wearable device.
• The partners say transit agencies can implement the Visa SAM technology without replacing current turnstiles or terminal hardware.
• The Rio de Janeiro Metro in Brazil will be the first city transit agency to roll out this contactless payment system in April.

Dive Insight:

Transit agencies slowly are transitioning from traditional systems to tap card or touchless systems. San Francisco, Los Angeles and Washington, DC are among the cities that have committed to these upgrades. Service companies like Visa and Mastercard Transit Solutions are adding services to their transit tech portfolios to meet transit agencies' needs. 

Agencies are catching on to the fact that citizens increasingly crave convenience in their daily lives. E-commerce, ride-hailing and microtransit all are services driven by the desire for convenience. A study Visa recently commissioned noted that convenience is one of the top factors riders consider when choosing their transportation.

Plenty of transit agencies desire system modernization and upgrades but budgets are tight and securing federal funding can be challenging. System upgrades can require extensive infrastructure overhauls that significantly bump up the price tag and make such a project an even harder sell.

Washington, DC, for example, noted that payment by cell phone will have to be done in phases because all 91 train stations will need new turnstiles and all buses will need new fareboxes. So the promise of implementing the new Visa SAM technology without having to replace existing turnstiles or terminal hardware could be quite enticing to transit agencies to keep project costs and labor in check.