London's buses will be the first mode of transport to accept contactless bank card payments, starting today.
The whole fleet of London buses will accept the payments, meaning that passengers can use an American Express, MasterCard, Maestro or Visa Europe card instead of Oyster cards or paper tickets.
Mike Cowen, head of transit solutions Europe at MasterCard, told Computing that the technology will make it easier for consumers to travel in London.
"You're cutting out the step of creating money into something else like a paper ticket, token or onto an Oyster card, it's a convenience benefit to the consumer and a potential cost saving for the transit agency because they don't have to sustain the distribution infrastructure that is required in order to get those fare products [such as Oyster cards] into people's hands," he said.
Commuters paying for their journey using MasterCard PayPass card will be charged the same fare as Oyster pay as you go tickets rather than the more expensive cash rate.
"The model on the buses is very simple, you tap the card and it takes a payment for £1.35 and every time you tap your card it will complete a £1.35 transaction. What will happen next year when it gets extended to the full Oyster model will be daily capping - and even weekly capping which is not in the Oyster model at the moment," Cowen said.
Cowen explained that Oyster currently calculates capping in real-time taking up a lot of data storage, meaning that it couldn't handle weekly capping but that Transport for London is moving this to the back office, suggesting that a future variance of the Oyster product could support the same service.
One of the key concerns highlighted by consumers is how secure the use of a bank card is for payments, but Cowen said that there were "half a million places around the world with the card in use and no increases in fraud to do with contactless payments".
He insisted that the PayPass card had the same security behind it as the transactional security around chip and pin payments.
"When you use MasterCard you get purchase protection, those mechanisms also apply to contactless payments as well, so there is a safety net," he said.
This may be welcome news to passengers who previously lost out on money that they had loaded on to an Oyster card which was then damaged, lost or stolen.
Although cash can be recovered from registered cards, figures published by Transport for London showed that almost £30m was left unspent on Oyster cards from April 2009 to April 2010.
The contactless payments will eventually also move onto the tube at some point next year, but with delays in the rollout of the technology for buses, Transport for London (TfL) has been tight-lipped about an exact rollout date, and Cowen was defensive about TfL's efforts.
"This is a hugely complicated project that involved massive infrastructure change, there was going to be bumps along the way such as the Olympics, but now we have the launch day," he said.
This paper seeks to provide education and technical insight to beacons, in addition to providing insight to Apple's iBeacon specification
Focus on cost efficiency, simplicity, performance, scalability and future-readiness when architecting your data protection strategy