ARCHIVES: This is legacy content from before Industry Dive acquired Mobile Commerce Daily in early 2017. Some information, such as publication dates, may not have migrated over. Check out our topic page for the latest mobile commerce news.

Toronto is latest to adopt mobile payments for public transit

Toronto Transit Commission, the third largest such agency in North America, has begun enabling payments through mobile devices, suggesting a future in which transit and mobile commerce are more closely linked.

Mobile ticketing and payments are becoming more of a staple in the travel industries, but have been slow to takeoff in major metropolitan transit systems. The TTC is the third largest public transit agency in North America, and introducing a mobile payments system in such a sizable transportation organization could refer to an oncoming serious shift in the industry.

“TTC is now able to reduce costs by distributing tickets via mobile versus other traditional ticket distribution methodology like ticket vending machines, box office and retail distribution,” said Micah Bergdale, CEO and founder of Bytemark Inc.

Transit ticketing
As more and more transit systems adopt mobile technology, mobile payments may be soon be seen as a staple in the transportation industry. While retailers among various industries are growing more towards mobile payment systems, it seems that the transit industry is one of the retail sectors that could benefit most from this transition.

For riders of public transit, mobile payments can offer a more positive experience as the systems removing the need for consumers to have search for their wallets, credits cards or cash. Numerous consumers have mobile devices in close proximity at all times, and providing services to pay through a these devices means a quicker and easier manner of traveling.

Going mobile can benefit transit providers as well, as it reduces the cost of upkeep on the high quantity needed for ticket vending machines and booths. Mobile payments offer the possibility of shrinking the number of machines needed, and also decrease any wait time that can be associated with travel payment.

Starting this month, commuters in Toronto will be able to pay for their travel on subways, buses, streetcars and paratransit. Mobile device users can download the mobile application through iOS or Android, in which they can purchase and store transit tickets.

The TTC  is working with Bytemark Inc. to provide the mobile app to consumers. The company is also working on providing mobile payment technology for FutureRailway in the United Kingdom, and has previously launched similar ticketing services for NY Waterway and Capital Metro in Austin, Texas.

Toronto’s announcement follows a further mobile introduction for NJ Transit, with the transit organization has been rolling out mobile payments and ticketing expansions throughout the year for its bus and rail services.

Shift in payments
Mobile tickets are set to account for more than one in two ticket transactions on digital platforms by 2019, following a two-fold growth over the next few years as the transportation sector ramps up mobile offerings, according to a recent report from Juniper Research (see more).

Also, transit companies flocked to mobile ticketing after Superstorm Sandy caused ticket machine outages all over the Northeast in 2012, inciting a rapid rise in the implementation of mobile transit ticketing, according to Bytemark, Inc. (see more).

“This opens the door to numerous other organizations in the Toronto metro area to take advantage of the mobile payments infrastructure that has been laid with the public transit agencies in Ontario,” Mr. Bergdale said. “We hope to demonstrate Ontario as a leader in mobile payments more generally as this solution becomes more widely adopted.”

Final Take
Brielle Jaekel is editorial assistant at Mobile Commerce Daily