Enhancing Mobility: Exploring the Extremes of Merchant Payment Solutions

In today's world, where urban mobility is becoming increasingly important and intense, the development of an efficient payment acceptance system in public transport is an integral part of ensuring comfort and convenience for passengers. Studying the basic requirements for such a system allows us to understand the complexity and diversity of factors that need to be considered for its successful implementation.

Public transportation is not just a means of getting around; it's a complex system that provides mobility and accessibility for millions of people worldwide. Often, it is seen as a special type of service that cannot simply be classified as traditional commercial enterprises. The public transportation system has its own unique characteristics that need to be taken into account when developing innovative solutions, including in the field of payments. In this article, we will examine the key requirements for payment acceptance systems in public transport, highlighting their importance and role in ensuring comfort and efficiency for passengers and carriers.

Revenue Distribution

The first extreme condition to consider is the ownership structure and the complexity of interests among involved stakeholders. Typically, a transportation enterprise is either state-owned or has a significant share owned by the government. It may also be directly regulated by the government, or the government may be involved in both management and revenue sharing from transportation. It's quite possible that one company handles transportation services while another is tasked with collecting funds - a payment operator that may serve multiple transport providers. Additionally, considering the multitude of participants in the process, including drivers, conductors, bus owners, transport license holders, transport parks, and regulatory bodies, it is necessary to account for and distribute revenue among all stakeholders. This process often complicates the digitization of the process since it is a highly sensitive factor for all involved parties.

System Requirements: Involvement of all process participants, ensuring multi-level access with different roles, a unified information base to ensure transparency and integrity of the process considering the interests of all participants. Additionally, the system must be capable of distributing revenue among different participants based on complex rules established within the business environment.

Clearing and settlement?

The second extreme condition is that process participants are so sensitive to revenue and its fluctuations that they are not willing to accept settlements taking more than a day. Indeed, often, same-day settlements are required. These are the industry's demands: the fleet requires maintenance, fuel, and payroll payments on a daily basis.

System requirements: settlements and clearing on the same day or online; the system must provide real-time access to reporting and dashboards for evaluating the efficiency of the vehicle fleet's operations.

Number of sales points

Now let's imagine a typical passenger transportation company. Its first distinction is the sheer number of sales points - hundreds and thousands of them. They are distributed across dozens of routes that can operate under completely different rules. I'm not talking about metro or BRT right now - which is a special case where stations can be equipped with ticket offices and payment terminals. Primarily, I'm referring to cases where thousands of buses owned by different companies operate on dozens of routes, each with its own set of rules.?

System requirements: the ability to work simultaneously with a large number of terminals, grouping options for terminals, remote configuration by groups, models, and stations.

The quantity and aggressive operational environment also demand an effective monitoring system and a system for quickly replacing terminals in case of malfunctions. The reliability of payment terminals is of paramount importance here.

Variety of fare rules?

And here's another extreme - fare rules are so diverse and often unique. Fares can differ based on the following main parameters:

- distance or travel between specific zones - which typically reflect the distance between the origin and destination points;

- category of the traveling passenger - whether it's a regular traveler,

- number of transfers or the presence of specific points in the current route - types of transfers, parking lots;

- type of ticket purchased - subscription, pass, single ticket;

- time of travel or its duration (seasonality, peak hours, holidays and weekends, festivals).

They can also be fixed, which simplifies the picture, but doesn't fundamentally change it.

Accordingly, the payment acceptance solution should be able to work either automatically, where the fare is calculated entirely based on pre-set rules, and the passenger only needs to tap their ticket or card at the entrance and exit of each station or stop, or manually, where the driver or conductor takes control to manually set the tariff rule, for example, for baggage payment.

The shift towards fully automatic fare collection is entirely up to the carrier, but the technology must be ready at all times.

Time for Payment Acceptance

When analyzing the complexity of fare collection, an important aspect is the time required to issue a ticket or allow a passenger to use transportation, as determined by the carrier. Modern standards define this time as no more than 500 milliseconds, which is practically imperceptible to the human eye. The requirements of the transportation industry are driven by a number of reasonable factors: even minor delays at entry points can cause congestion and lead to delays in transportation.

This imposes very strict requirements on the speed of identifying the payer to complete the trip, or more precisely, on the speed of ticket issuance.

Aggregation and Reconstruction of Trips

A crucial aspect to consider is the fare cost, which often remains low. On average, public transportation fares are as little as half a dollar. This is particularly relevant for developing countries where a significant number of tickets are sold. Another important consideration arising from this fact is the number of transactions.

The size of fares necessitates that the system be capable of aggregating multiple trips into a single transaction, taking into account various rules. For example, the system should consider the transaction amount (e.g., upon reaching a certain threshold), waiting period (e.g., within a few hours), and route (e.g., round trip).

Diversity of Fare Payment Methods

Now, it's essential to carefully examine the profile of passengers using the transportation system and adapt the payment system according to their habits and preferences. It's important to consider established practices and traditions both in determining fare tariffs and selecting payment methods, whether it's cash or electronic money.

The implemented system should possess sufficient flexibility to accept the most convenient fare payment methods. Moreover, it should be capable of evolving alongside the ecosystem, offering more precise and convenient payment methods that take up minimal time and are convenient for both passengers and carriers.

Ultimately, the payment methods should aim to simplify the process, reduce the number of transactions, and processing time, thereby reducing the time spent at stations or stops during boarding, and so forth.

Offline Operation

Another significant limitation is that transportation is constantly in motion and often operates outside the range of stable internet signals. Therefore, the implemented solution must be able to work in offline mode, without the need for an internet connection, at least for a certain period of time.

Conclusion

It is important to understand that the payment system in transportation must be flexible and adaptable to various passenger needs and habits, as well as to the complexities associated with managing transportation flows and ensuring safety. It should provide convenience and ease of use for all participants in the process, as well as be efficiently managed and updated in accordance with changing conditions and technological requirements.

Examining the key requirements of the payment acceptance system in transportation allows us to identify several key aspects, such as the diversity of payment methods, the need for trip aggregation and reconstruction, as well as strict requirements for payment identification speed. Understanding these aspects helps developers and transportation system managers create more efficient and convenient solutions that can meet the needs of modern urban passengers and improve the quality of public transportation.

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