According to a report by World Bank, 34% of India’s population resides in urban areas. Another report by United Nations speculates that by 2050, the urban population in India will have increased to 87.7 million and the rural population will account for 78.3 million people. This would increase the population density and also add immense pressure on the existing resources and infrastructure. Transportation won’t be spared either. The need for smart, sustainable solutions is the need of the hour and the Nandan Nilekani-led committee on digital payments has emphasized the same in its recommendations submitted to the Government.

The changing payment landscape in India has raised the bar for technology players as well as solution providers. Today, consumers have a multitude of options to purchase any good or service and mostly, this happens with just a few clicks. It comes as no surprise that consumers will seek the same, if not heightened, sense of convenience when it comes to mobility as well. This makes payments an integral part of the ever-evolving mobility scenario in India.

Need for faster, swifter mobility

Smart cities need smart travel options. With the fast-paced life that metropolitan cities offer, it becomes imperative to have a transit system that can support this pace and lifestyle. Public transportation is the bloodstream of any city. Therefore, for any city to be termed as a ‘smart city’, it has to have a strong and robust public transportation system that can sustain the footfall of millions. While mobility has gained momentum in the last few years, payments as a service will certainly drive this forward.

QR Code Ticketing

Even before QR code revolutionized digital payments as we know it today, Kochi Metro introduced QR based (paper) ticketing in 2017. AGS Transact Technologies collaborated with KMRL to address the main concern with use of QR codes in transit i.e., longer scanning time, by launching a more efficient QR code system that takes only 100 milliseconds to scan the code as compared to the 250 milliseconds taken by a contactless card to scan. Cut to the covid-19 pandemic, QR code is driving the wave of contactless payments in India across all sectors including mass mobility.

The biggest advantage that QR based tickets offers is swifter and hassle-free checkouts. Being contactless, this solution is seen as a game-changer in days to come. BEST in Mumbai and State Transportation Buses in Maharashtra are already beginning to test this ‘contactless’ ticketing solution.

Mobility Cards

A Government of India initiative, National Common Mobility Card (NCMC) or One Nation One Card is designed to enhance the penetration of digital payment options throughout the country. Through this card, NPCI aims to digitise cities and make intercity as well as intra-city transport seamless and hassle-free. With path-breaking technologies such as Near Field Communication (NFC), these cards simply have to be tapped at flap gates, retail stores, and can also be used for cash withdrawals at ATMs.

Currently, each mode of transport in India has its own ticketing system and NCMC intends to integrate this. For instance, if a consumer leaves for office, hails an auto rickshaw or ferry, further takes a metro, and finally boards a bus to reach his destination, all he has to do is tap the same card at all ticketing or entry/exit points. This relieves the consumer from the cumbersome task of carrying exact change and also brings down the commute time significantly. Being RuPay-operated, this card can be used to withdraw cash from ATMs as well.

Looking at the pandemic and its impact, these NCMC cards are likely to consume the future of mobility. Kochi Metro had already deployed NCMC Cards with Axis Bank where AGS Transact Technologies is the system integrator. Recently, Delhi Metro for phase 4, along with State Bank of India, has launched a card that enables users to travel through metro and also use it for cash withdrawals at ATMs. Similarly, Bangalore Metro and Chennai metro station are also in process of introducing NCMC. Bangalore Metro has already awarded this work to RBL Bank Ltd. where AGS Transact Technologies will be the Technology Partners.

National Electronic Toll Collection

To avoid congestion at toll plazas, National Highways Authority of India or NHAI has introduced FASTag, a RFID based sticker, to process seamless electronic toll collection. FASTag assures swifter and more transparent toll process as the RFID tag on the windshield is scanned as the vehicle passes the toll plaza.

FASTag saw a humble beginning in 2014, at the Golden Quadrilateral between Ahmedabad and Mumbai, pioneered by ICICI Bank. Today, FASTag is contributing to three-fourths of toll collection of ₹92 cr per day, a sharp jump from ₹70 cr a year ago. The usage has seen a sharp increase in the past few months as public transport had almost come to a standstill and people grew extremely apprehensive of using cash. As more vehicles plied highways, FASTag gained momentum. There are over 20 million FASTag users in the country and this surge is a result of the robust digital payment system, strong infrastructure and government’s push towards digital payments. There are plans of using FASTags for other utilities like fuel and parking.

Road Ahead

Mobility as a Service (MaaS) is set to be the next big thing in India. With an integrated mobility system, India’s commute will be smarter, faster and convenient as everything will be at one’s fingertips. The slew of measures taken by the Government of India has encouraged many payment players and infrastructure developers to build a strong and robust mobility infrastructure.

Electronic vehicles, self-driving cars, ride-sharing, contactless ticketing and electronic toll collection are set to frame the future of mobility. Recently, at the 3rd Annual Bloomberg New Economy Forum, Hon’ble Prime Minister Narendra Modi pitched India as an investment destination for Mobility. He also stated that India is building 100 smart cities and projects worth almost Rs 1.4 lakh crore have been completed or nearing completion. The Centre also aims to have 1000 kms of metro rail system in the country by 2022.

Such measures and projections bring India closer to the dream of becoming a country with a smart, agile, and futuristic country.

Smart and Sustainable Payments Solutions crucial for the Indian mobility industry

The changing payment landscape in India has raised the bar for technology players as well as solution providers.