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RFID to Ride N.Y. Subways

New York City Transit, MasterCard International and Citi will test MasterCard's contactless PayPass payment system in 25 New York City subway stations.
By Beth Bacheldor
Jan 31, 2006Currently, anyone seeking to ride a New York City subway train must first swipe a magnetic-stripe MetroCard through a reader built into the turnstile. With the new RFID-enabled Citi MasterCard key fob or card, however, both of which feature an embedded MasterCard PayPass RFID tag, all it would take is a quick tap to get through the gates and onto the trains.

MasterCard International and financial services company Citi have announced they are working with the Metropolitan Transportation Authority (MTA) and its New York City Transit division to test MasterCard's contactless PayPass payment system in 25 New York City subway stations. These stations serve approximately 900,000 riders daily.

"We are looking at various options of smart cards, and how they might be integrated in a transit environment," says Paul Korczak, assistant chief officer of MetroCard sales for the MTA. "We know, by and large, that all the technical aspects [of contactless payment systems] have been worked out and market-tested, and now we want to know if customers who are typically paying cash would want to use this kind of payment."

MasterCard approached the MTA, according to Korczak, and offered the transit authority the opportunity to participate in the trial at no cost or obligation. MasterCard's PayPass system, he explains, can incorporate the MTA's fare card policy, which allows customers to pay as they go and earna percentage toward a free ride each time they buy a fare.

The trial will reportedly tell MTA not only whether customers like using contactless payment systems, but also how these systems need to be integrated with the MTA's internal systems, such as accounting.

An undisclosed number of preselected Citi customers will participate in the six-month trial, slated to start this spring. The trial will take place at 23 Lexington Avenue Line 4, 5, and 6 stations, between 125th Street and Bowling Green in Manhattan, at the Borough Hall station in Brooklyn, and at 23rd Street-Ely Avenue station in Queens.

The Citi cards will have both the traditional magnetic strip found in other credit cards and the PayPass RFID inlay, which operates at 13.56 MHz and has a short read range of 2 to 3 centimeters. Participants in the trial will be able to pay for their fare by tapping the Citi MasterCard card or key fob on specially equipped RFID readers mounted on the turnstiles (a graphic unique to the trial will indicate which turnstiles accept the contactless payment). Only trial participants will be able to use their Citi PayPass-enabled cards key fobs to pay for transit fares. Other subway riders possessing PayPass-enabled MasterCard credit or debit cards issued by other banks will not be able to use their cards at the specially equipped turnstiles.

The card or key fob securely transmits payment details wirelessly to the reader, which transmits the information to a sales terminal and then to the MasterCard network for clearing and settlement. The RFID inlay includes standards-based cryptographic authentication to avert the copying and emulation of the chip and the modification of its data by unauthorized parties.

The Citi/MasterCard/MTA initiative joins a long list of other RFID-enabled contactless payment systems being tested and installed throughout the country. Last year, MasterCard began working with card issuer MBNA to produce Seattle Seahawks- and Baltimore Ravens-branded Extra Points payment cards inlaid with RFID, intended for use at the teams' football stadiums (see MasterCard PayPass Beefs Up NFL Lineup). Similar efforts have been undertaken with the Philadelphia Eagles and the Detroit Lions.

Last week, American Express announced that customers could purchase food at 12,000 U.S. McDonald's locations using its RFID-enabled ExpressPay card (see At McDonald's, ExpressPay Fits the Bill). McDonald's also accepts MasterCard's PayPass. Many other businesses, from CVS Pharmacy to AMC Theatres, also accept contactless payment cards from American Express, MasterCard and Visa.
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