Over half of the world's population lives in cities and this is predicted to rise to 70 per cent by 2050. With more and more people living, working and travelling in cities, many urban hubs in New Zealand and around the world are facing significant challenges.
As anyone living in Auckland knows, a challenge that many growing cities face is managing the flow of people. Despite differences in size and infrastructure, most cities across the world have goals to improve the efficiency of transport.
Across the world there are over 300 different public transport payment systems. Each system has an individual network and a unique payment card. Even within New Zealand, the transport cards that can be used in Auckland cannot be used in any other New Zealand city, making it inconvenient for travellers and tourists to connect to a different network.
Open-loop transport systems allow people to pay for their travel using their existing debit or credit card, mobile device, or any other payment device. This eliminates the need for people to carry a separate transit specific card, meaning greater convenience for travellers, as well as assisting to drive increased uptake of public transportation.
In a world that is becoming increasingly cashless, consumers and commuters want to have greater choice around how they pay. Emerging payment technology means overseas people are already using mobile wallets on smartphones, tablets and wearable devices linked to their credit or debit cards to tap on and off transport. These new technologies are expected to increase over the next few years.
Transport for London is now seeing half of all trips paid for using contactless – around 17 million journeys per week. Around one in eight of contactless journeys are being made using a mobile phone or smart device. This relieves some pressure on London's transport system by making the payment process faster and more convenient.
The expansion of contactless payments technology also provides a convenient option for those who do not use public transport frequently, are domestic or international tourists, or simply locals who left their travel payment card at home.
Integrating contactless payments into transport ticketing systems, across trains, buses and ferries is a solution being embraced by many cities. Just across the ditch, Mastercard worked with New South Wales Transport to develop and implement a system using contactless payments to pay for the ferry from Manly to Circular Quay. During the first six months of the trial, there were more than 15,000 tap-and-go payments from cardholders which spanned 42 countries.
The trial was a success, and last month NSW expanded the service to include all Sydney ferry services and the inner west light rail.
New Zealand is also beginning to investigate these public transport solutions. Recently, the Greater Wellington Regional Council announced public transport authorities will explore national public transport ticketing.
The long-term programme is designed to establish a contactless payment network across all public transport options in New Zealand. New digital technologies will play a significant role to make all types of payments easier and more convenient for users.
Smartwatches, biometrics and other emerging technologies are allowing people to leave their wallets at home when they go out and about. If people can eventually pay for public transport using any device, operational costs for transport companies and consumers will decrease, and the overall user experience will be more convenient.
To be a smart city that uses technology to improve the lives of everyone, cities across the world need to embrace world-leading transport processes. Mastercard is focused on partnering with the public and private sectors to make cities more accessible to domestic and international visitors, make multi-step journeys easier for residents, and ultimately make travel more convenient for everyone.
• Ruth Riviere is country manager, New Zealand and the Pacific Islands, for Mastercard.