How do your passengers want to pay for transit? We debate this issue again and again, trying to figure out the relative merits of different fare validation technologies and approaches.
Things seem to have settled in a bit now. Contactless systems are clearly the way forward for North American agencies and there’s mounting evidence that the future “payback” opportunities of validators far outweigh the costs of acquiring and maintaining them.
There does seem to be a bit of lingering confusion about the relative cost/benefits of validators and validating fareboxes, though. So let’s start by clearing that up.
Validators
If cash collected on-board is of less significant source of fares, then adding a simple, less expensive validator to your vehicles may be the best way for your agency to start enjoying the benefits of fare validation.
Validators are small, often pole-mounted units that usually feature a smart card and/or barcode/QR reader (to accept smart media, barcodes and QR codes), and passenger-facing display, so the rider can see their fare has been validated and accepted. Data recorded by the validator is integrated with other fare collection data to help planners and schedulers better design routes and timetables and improve efficiencies.
Any cash collected would be using the existing farebox or mechanical dropbox and may not have the ability to integrate fare collection data with the validator depending on the intelligence of the farebox/dropbox.
Validating Fareboxes
Validating fareboxes require a bigger upfront investment than pole-mounted validators but they’re worth it.
Validating fareboxes have validator modules for cash (bills and coins), smart media and barcode/QR or magnetic media all in one package. These validators all work together to significantly reduce your agency’s exposure to fare fraud.
In addition, the validating fareboxes provide rich data on fare payments, passenger usage and other data that is invaluable to all agencies, regardless of size.
Those are big benefits for your agency. Add it all up, and in the long run you are saving money by investing in validating fareboxes.
With these distinctions in mind, here are some real-life examples of how other transit agencies are cashing in on the business intelligence (BI) validating technologies generate.
Ridership Increase in Banff
The City of Banff, Alberta was hopeful their investment in validating fareboxes would pay off eventually. It didn’t take long – within the first year after installing their validating fareboxes, business intelligence pulled from the system helped the agency to recreate routes and schedules resulting in the reduction of operational costs which equaled the purchase price of the system. In addition, by having all fares validated and all passengers properly counted, the City saw a 33% increase in ridership in just one year.
Reduced Fraud in Brandon
Not long ago, Brandon Transit in Brandon, Manitoba had an all-cash fare system – it was impossible to monitor and control what was going on in the box. As a result, they had major fraud issues.
By adding validating fareboxes, Brandon was able to significantly reduce losses from fraud and as a downstream result, increase revenue per rider. A core metric for every agency.
Fare Conclusions
As use cases like these continue to emerge and agencies have more and better examples to build their business cases on, the conversation will evolve to focus on how to exploit the business opportunity that Banff, Brandon and others have already identified: Validating fareboxes are a tremendous source of business intelligence with value for every part of the agency.
Bus
Rail
Paratransit
