SEPTA's new electronic payment system will be a big change for rail commuters

SEPTA's new electronic fare-payment system may herald the biggest change for local rail commuters since the Center City tunnel was built 30 years ago.

SEPTA expects to award a contract this month for its long-delayed "smart card" fare system, which will allow bus, subway, trolley, and train passengers to pay for their trips by tapping any "contactless" bank card on an electronic reader. Riders can use credit or debit cards they already own or get smart cards from SEPTA.

The system is also being designed to eventually accept payment from smartphones.

The $100 million system will take three years to install, so SEPTA riders won't immediately shift from their tokens, passes, tickets, and cash.

For most bus, subway, and trolley riders, electronic fares won't mean a big change in commuting habits - new card readers will simply replace old subway turnstiles and bus fare stanchions.

For rail passengers, though, electronic fares will alter their traveling experience. The big question is, will new be better?

The stakes are considerable: Regional Rail's 118,000 daily passengers account for 13 percent of SEPTA's riders and 25 percent of its revenue.

One of the biggest changes for rail riders will be gates and turnstiles in Center City train stations to herd passengers past electronic fare-readers.

At the other end of their trips, riders will need to "tag in" or "tag out" with a smart card for their fares to be deducted. That may be done at stationary readers on a train platform or by conductors with handheld devices on trains.

Either way, it's sure to mean a change for riders used to rushing to and from trains and simply presenting a pass or ticket to a conductor.

And the zones that determine how much rail riders pay may also change as part of the shift to electronic payment. Then there's the issue of how to accommodate occasional riders and out-of-town visitors.

"Regional Rail is the biggest challenge, for sure," said Leo Bagley, assistant director of the Montgomery County Planning Commission and a member of a regional advisory group helping SEPTA plan the new system.

"We're all in favor of making it somehow easier, and I think we're getting there," Bagley said. "SEPTA is still struggling with some things like fare structures and transfers. There are still more issues to decide."

Regional Rail will be the last part of the SEPTA network to switch to electronic fares, and Bagley said he was optimistic that by the time rail passengers make the shift, the problems will be solved.

"We want to get it right the first time. We don't want to go back and do something over," he said.

An organization of train riders is less sanguine; it predicts the new system will disrupt riders' routines and mean lost revenue for SEPTA.

"It's adding a lot of burden to riders," said Matthew Mitchell of the Delaware Valley Association of Rail Passengers. He said SEPTA should not approve a new rail fare system until questions are answered about possible fare evasion, changes in fare zones, travel between non-Center City stations, discounts for senior citizens and children, and potential fare overcharges.

SEPTA will be the first large rail agency in the United States to switch to an open electronic fare-payment system. It should move cautiously into that brave new world, said Joseph Hacker, a transportation planner at the Delaware Valley Regional Planning Commission.

"My concern with being the innovator is that you risk becoming the prototype that reveals the bugs," said Hacker, who is also a member of SEPTA's advisory panel.

John McGee, chief officer of new payment technologies for SEPTA, said, "Our hope is to minimize the change for our riders."

McGee said the ability to use an existing credit card should make travel easier for riders, especially occasional and new riders. And pass holders, who account for 63 percent of rail passengers, can load monthly or weekly payments onto a credit card and "never buy a weekly or monthly pass again," he said.

"People don't like change," said Dan Fleishman, a senior consultant at TranSystems Corp., a transportation planning firm that is consulting for SEPTA. "The ridership experience will change a little, but it will just take a little getting used to. . . . It's not going to drive anybody from the system."

By building an "open" fare system that allows riders to use any contactless card instead of a "closed" system that requires a transit card, SEPTA is gambling on a future still taking shape.

Right now, only 10 to 15 percent of the 750 million credit and debit cards in the United States are contactless, equipped with a computer chip that communicates with a card-reader.

That number is expected to grow rapidly, as Visa in August announced financial incentives for merchants and banks to switch to contactless cards and readers, said Randy Vanderhoof, executive director of Smart Card Alliance, an organization that advocates for wider use of smart cards.

The goal is to have 75 percent of cards be contactless by 2013, Vanderhoof said.

And the card issuers see transit agencies as fertile new ground.

"There's extreme excitement and interest by the [issuers], because they want to see more transactions," McGee said. "It's strategically valuable for the payments industry and for transit . . . that's why you're seeing this huge investment."

A major issue for SEPTA is that about 30 percent of its riders, including about 10 percent of its Regional Rail passengers, don't have bank or credit cards.

Those customers will need to buy SEPTA-issued, reloadable contactless cards.

As SEPTA prepares to award its electronic-fare contract, three companies remain in the running: ACS Transport Solutions Group of Columbia, Md.; Cubic Transportation Systems Inc. of San Diego; and Scheidt & Bachmann of Germany.