Public Transit: Simplified Tariffs and Automation Strategies

In the previous article, I discussed the extreme requirements for implementing cashless systems, and now I will focus on one of the most complex and contentious aspects of payment automation for transportation operators - the application of various tariffs.

Fare collection is a key business process that transportation providers are deeply concerned about. Unfortunately, when it comes to implementing infrastructure projects in the transportation sector, insufficient attention is paid to this issue. Instead, a proper and efficient payment collection system is the cornerstone of successful infrastructure operation, where efficiency and transparency are key principles.

So, the main aspects of building an effective fare and payment collection system are as follows:

• Reliable revenue collection is necessary to ensure the functioning of the infrastructure and maintain high-quality transportation services.
• Fare calculation and ticket sales for public transport are routine operations, and even minor changes in them can lead to significant cost increases, such as the need to print paper tickets or issue receipts to passengers.
• Given the scale of public transportation and frequent cash transactions, there is a high risk of shadow money collection schemes.

In other words, to ensure the profitability of the transportation system, it is necessary to ensure transparency and reliability in fare collection, with minimal costs. There is plenty of work to be done in this direction.

The main issue arises, which may seem unusual to some - many transportation companies operate extremely complex fare structures. There is no simple scenario of "boarding a bus, paying a dollar, and leaving." Very often, the fare for the journey is determined through intricate distance tables, zone networks, and other parameters.

This always becomes one of the key aspects when interacting with transit operators. The argumentation typically goes like this:

- Yes, you have a very good system and you explain everything very well. But it's different for us. Our tariff system is complex, people are used to doing things a certain way, there's no internet access anywhere, and so on."

And the Transit Operator continues to operate based on a minimal planned revenue system, maintaining a conductors' team or being forced to accept the existence of informal cash transactions.

But what about the tariffs and how to automate them? Let me tell you right away that regardless of the complexity of the tariffs, everything can be automated. The question is how exactly to do it in a way that the new payment system is accepted by market participants.

Types of fare rules

Various types of tariffs for urban public transport include:

• Fixed fare - pay and go.
• Zonal fare - depends on the number of zones the route passes through.
• Fare based on the number of stations or distance traveled.
• Calculation of distance between boarding and alighting, similar to taxis.
• Counting the number of transfers and stations, especially important if the lines belong to different carriers.
• Time-based tariffs - seasonal, peak hours, holiday periods, etc.
• Special conditions for certain categories of passengers.
• Various discounts, surcharges for transfers, time restrictions, penalty fares, etc.
• Package tariffs, including transfer trips, seasonal or daily tickets, tickets within one zone, etc. - combined options.

In addition, the payment method also affects the tariff calculation - on-board or at the station. Station-based systems, such as MRT, LRT, BRT, where tickets are sold at stations, use fare calculation based on entry and exit points, taking into account other trip parameters.

More challenging for automation are the transport vehicles where payment occurs on board, often in motion, rather than at a station. Here, the key factor is the recording of entry and exit using a single device, which requires the use of GPS data or even more advanced location systems.

Nevertheless, any tariff scenario can be automated and starts working more efficiently, eliminating the drawbacks of manual payment collection and arbitrary tariff calculation by conductors. However, as mentioned earlier, it often makes sense to move towards simplifying tariff structures, not only in the context of automation requirements but also for the easier understanding of the tariff essence and payment amount by passengers.

Simplifying fares

Here are some premises for standardizing and simplifying tariffs:

• Historically, tariff systems have taken very complex forms, becoming multi-level and confusing. This discourages young people and tourists unfamiliar with these rules from using public transport in favor of private transportation, which contradicts our goals.
• With the implementation of automated fare collection, the accuracy of the automatic system may be higher than the familiar "eyeball estimation" by conductors, which can lead to underpayment or overpayment by passengers.

The use of complex tariffs based on distance or the number of stops in light passenger transport can make determining entry and exit less reliable due to dense construction or route peculiarities, which complicates precise location determination.

Automated tariff calculation opens up many opportunities for transport operators:

1. Implementation of season passes and combined tariffs reduces the number of transactions in the system and the costs of fare collection systems. It's also possible to apply fair fare - a tariff method where the system automatically selects the most advantageous fare based on travel patterns and usage of the transportation system.

2. Management of passenger flows through marketing tools, providing discounts or surcharges during peak hours, contributes to relieving the transportation system.

3. Implementation of advanced payment methods, such as mobile applications, bank cards, biometrics, helps reduce the time spent by passengers on payment and reduces ticket infrastructure costs.

Conclusion

Automation of fare collection in the transportation sector represents not only a technological challenge but also an opportunity for radical improvement of the public transport system. It opens doors to more efficient and transparent revenue collection, streamlining processes for both passengers and operators, and creating a fairer and more adaptive tariff system.

Considering all the challenges and potential benefits, the key to success lies in balancing technical capabilities with user needs. This requires not only innovative IT solutions but also a deep understanding of the social and economic aspects of transportation services. Ultimately, the goal is not just automation for the sake of automation but creating a system that makes public transport more accessible, convenient, and preferable for all segments of the population.

Thus, transport operators are tasked not only with implementing new technologies but also with rethinking the approach to tariffication, making it more understandable, flexible, and fair. Perhaps this will be the catalyst that leads to long-awaited changes in the public transportation industry.