PATCO may test open-payment fare collection

Passengers on PATCO commuter trains soon may be among the first in the country able to pay their fares with credit or debit cards.

A proposal approved by a committee of the Delaware River Port Authority would permit the installation of electronic readers at PATCO stations to accept certain Visa cards and PATCO's own Freedom Cards.

The readers, which must be approved by the DRPA board next month, could be in place by January, said Robert Box, general manager of PATCO. The transit agency operates commuter trains on a 14-mile line between Center City and Lindenwold.

The proposal would allow Cubic Corp. of San Diego to upgrade the PATCO gates it installed in 2007 to read bank cards that use an embedded electronic chip. The gate readers now accept only the PATCO card, with its own chip.

The one-year pilot program would allow Cubic to test an "open-payment" system designed to free customers from the need to buy a transit card to pay fares. Instead, they could use bank-issued cards, such as debit or pre-paid cards.

Other transit agencies, including SEPTA and NJ Transit, are considering open-payment systems as they move toward electronic fare-collection.

The demonstration project at PATCO would give Cubic a working system on which to test its technology, said Phil Dixon, director of new product development for the company.

"We want to try it in a real-life environment," Dixon said.

Cubic will pay the cost of upgrading PATCO's gates and computer-operating system, as well as the transaction fees charged by cardholders' banks. The upgrades are worth about $680,000 to PATCO, Box said.

"We see it as a win-win for both them and us," Box said.

During the first six months of the pilot project, Bancorp Inc. of Wilmington will market reloadable prepaid PATCO Visa cards through area merchants. They could be used for travel on PATCO or for purchases at any merchant that accepts Visa cards.

"A customer could use it at Starbucks or Target," Dixon said.

During the second six months, any "contactless" bank card with an electronic chip would be accepted by the PATCO readers. Contactless cards are marked with an icon resembling a radio wave.

After a year, the pilot program would end, and the Visa-reading capability of the gates would be disabled.

The program could be continued, if PATCO and its customers wanted the service, but PATCO would have to pay the transaction fee for each contactless payment.

Those fees could be prohibitive for the relatively small transit agency. But if neighboring transit authorities, such as SEPTA, also adopted open-payment systems, "maybe you could negotiate fees that were reasonable," Box said.

In the meantime, Box said, PATCO wants to make sure the test doesn't interfere with its well-received Freedom Cards.

"Our customers are very happy with what we have now," he said. "When we do the pilot program, we want to make it clear it's for a year."

Contact staff writer Paul Nussbaum at 215-854-4587 or pnussbaum@phillynews.com