TfL reports that its plans for future ticketing will save money. It states, for example, that introducing contactless bank cards as tickets will result in a cheaper and easier ticketing system to manage. The current Oyster card system is expensive and complex. For every £1 TfL collects from Oyster card ticket sales, 14 pence is spent on the actual system. The Oyster system relies heavily on the cards themselves and the readers. By contrast, the technology for the contactless payment system is rooted in back offices. The new system will not require TfL to issue any cards and it will not involve the card readers having to hold detailed fares information and transfer it to the cards.
In the longer term, the introduction of contactless bank cards could provide scope for TfL to develop a new fares policy and ticket products. With the new technology rooted in back offices with unlimited capacity, TfL could develop more sophisticated, tailored fares. It might be able to provide peak hour pricing, develop loyalty programmes, and improve its offer for groups whose travel patterns vary e.g. part time workers.
The Committee will explore the potential implications for TfL of its plans for ticketing. This will include examining TfLs reasons for allowing the use of contactless bank cards as tickets and how far this development might save money, especially as the Oyster card system will continue to operate. The Committee will explore the extent to which the contactless payment system will be easier to manage and will resolve issues that have arisen with the Oyster card system. The Committee will also consider potential longer term benefits for TfL from the introduction of contactless bank card payment relating to its fares policy and ticket products.
