Indian Consumers Expected to Use Debit and Credit Cards to Pay for Public Transport Instead of Cash – Report

Koan Advisory Group, a New Delhi-based public policy consulting firm released a report titled “Transit Payments in India – A Case for Choice and Interoperability.”

The study highlights that India’s public transit systems should “allow integrated fare payments across different modes of transit, to provide end-to-end payment interoperability for commuters.”

It is based on a survey of 1,250 commuters “in over 60 different locations across four metro cities.” The study is described as a first-of-its kind report that “focuses on the problems commuters face while paying for public transit, and the factors that influence their perceptions of different payment modes.”

The report examines recent developments “in transit payments in India, highlighting the need for authorities to prioritize account-based ticketing systems over those that solely rely on prepaid card balances.”

It begins by first “identifying the gaps in transit payments based on an analysis of commuters’ responses to an on-ground survey.” The study found “that 90 percent commuters use different modes of travel to complete their journey and 76 percent of them want multiple modes of payment enabled throughout their journey.” Interestingly, the survey also found “that 66 percent of the total respondents want to use their bank cards at transit entry or exit points.”

The report also claims “that 66 percent of respondents preferred using a debit/credit card in transit systems, and 63 percent of respondents agreed that it would save them time as they wouldn’t have to purchase and recharge a prepaid transit card.”

This trend, in line “with India’s evolving demographic landscape, suggests that the preference for debit/credit card usage in public transit is poised to grow over time.”

Simultaneously, commuters’ reliance “on cash and prepaid transit cards is expected to decline.”

This observation is in sync “with the expanding accessibility of digital payment products and fintech solutions, including virtual cards, in India.”

Ateesh Nandi, Koan Advisory Group says:

“India’s public transit systems must evolve to provide integrated fare payment options that cater to the diverse needs of commuters. Our study clearly shows that commuters are looking for choice and interoperability in payment methods, with a growing preference for debit/credit cards and digital solutions.”

To address the challenges of India’s fragmented transit landscape, it is essential “to prioritize account-based ticketing systems that connect seamlessly with users’ bank accounts.”

This approach will not only enhance convenience “for commuters but also pave the way for a more inclusive and modernized public transit system in India.”

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