Monday, October 7, 2013
On Sept. 9, 2013, the much anticipated Ventra Card went live in Chicago. The dual transit and general purpose reloadable (GPR) prepaid card is being called the first of its kind to be implemented in a major U.S. city. First Data Corp., the largest U.S. acquirer and the payment processor for the GPR portion of the card, characterized the launch as the next step in the convergence of payments, where cards once used for separate purposes are combined into one convenient, multifunction payment instrument.
The Ventra Card is MasterCard Worldwide-branded and embedded with near field communication (NFC) technology to enable contactless payments. The Chicago Transit Authority is managing the program, with the physical, NFC-based POS hardware on Chicago buses and trains supplied by Cubic Transportation Systems Inc., a division of Cubic Corp. The card takes the place of the closed-loop, transit-only Chicago Card and its variants.
"Ventra replaces CTA's outdated, nearly 20-year-old fare-payment system and brings flexible, convenient amenities to customers who take nearly 1.7 million rides on the CTA each weekday," said CTA President Forrest Claypool.
On Cubic's contactless fare payment system, open-loop, network-branded credit and debit cards can also be used to pay for rides.
Mark Putman, Senior Vice President and Division Manager of First Data Prepaid Solutions, believes the Ventra Card is a substantial upgrade for approximately 25 percent of all Chicago area transit riders, and not just to pay for transportation.
From paying exorbitant fees to cash checks at check cashing operations, to paying more fees for money orders to pay bills, the cost to conduct everyday transactions is high for this demographic, Putman noted, adding that it costs an average of $30 per month for unbanked individuals just to access their cash.
From the transit "bucket" of the Ventra Card, users pay fares, while paychecks can be direct deposited to the GPR bucket and used to pay bills electronically or get cash out of some 60,000 ATMs in First Data's Money Network. At those same ATMs, as well as at Chicago transit locations and at the retail outlets of 700 different merchants in the Chicago area, Ventra users can top up cards.
"So there are a tremendous number of ways that individuals can use the card and live like a normal human being," Putman said.
The CTA said its mass transit network (trains as well as buses operated by Pace), provides over 580 million rides each year, with more than 80 percent of riders taking the CTA trains and Pace buses daily. The CTA added that 40 percent of riders buy passes at retail locations. Given that volume and reach, the CTA naturally has big plans for the Ventra Card.
"Expanding the retail network is critical to making Ventra easily accessible to CTA and Pace riders," said Claypool. "Ventra will soon be conveniently available at neighborhood retailers as well as online, by phone and at all CTA rail stations."
The Ventra Card is being sold at CVS/pharmacy, Jewel-Osco and Walgreens outlets, as well as the locations of independent Chicago retailers. The cards are also available at hundreds of currency exchanges. In 2014, the CTA expects to expand the distribution network for the card to nearly 2,000 locations across the Chicago area.
Putman said that it will be up to Chicago area merchants to decide what discounts or promotions they want to offer along with the Ventra Card. Although no First Data programs are in place specifically for the card, Putman recognizes the marketing and revenue potential of the Ventra Card for First Data ISOs with Chicago area merchants in their portfolios.
Since the Ventra Card is a first-of-a-kind program, many other city governments are watching its progress. "Definitely in the U.S., and I think actually broader than the U.S., there's a lot of cities that are following us closely as to how the rollout went [and] how the acceptance has been," Putman said. "And, thus far, it has been extremely positive for First Data and Cubic and the city of Chicago."
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