Should the city bus take cash? That essentially is the question asked by an article in the Chicago Tribune (Tourist season sees a peak in payments with dollars and coins, Jun 20). This actually turns out to be a question of capacity and scheduling. Cash transactions take more time and thus slow down boarding. If you have enough people paying with cash, the whole schedule for a bus goes out the window.
It takes about 25 seconds on average for a commuter to pay a cash fare, studies have shown, compared to about 2 seconds with a magnetic-strip card and about 300 milliseconds to receive authorization on a contact-less card such as a credit or debit card.
The article gives the example of the the Chicago Transit Authority’s No. 156 LaSalle bus being tied up for 15 minutes at one stop as a rush of people of people got on, many paying cash. This is not all that different from our article last fall on queuing for express lines at supermarkets. There is a fixed time per transaction regardless of the number of items purchased and that goes up when people pay by check.
For CTA, much of the slow down in dealing with cash comes from tourists and casual users (i.e., suburbanites venturing into the big city).
About 6 percent of CTA customers currently pay by cash, according to CTA records. That is down from about half of fares paid in cash in 1997, when the CTA introduced the magnetic-strip transit card. Still, in May, the 6 percent cash payments amounted to more than 59,000 transactions, according to the transit agency. The long boarding times that are fueled by cash-payers along with summer traffic create havoc with bus schedules, often resulting in sky-high travel times and spotty service as buses bunch up on portions of routes.
While the market share of cash fares is fairly stable — fluctuating from 6.6 percent in June 2009 to 5.6 percent in March 2010 to 6 percent in May 2010 — higher summer ridership overall results in 12 percent to 14 percent more cash-paying customers riding in June and July than during the winter, according to the CTA planning department. In addition, there are some pockets where cash-paying is much heavier than 6 percent, predictably in tourist areas and near the Metra and Amtrak train stations, the Museum Campus, Navy Pier and Michigan Avenue, transit officials said.
The CTA hopes to address the use of cash by implementing some kind of smart card payment system that could be used for other transactions besides just riding the bus. Such systems are used in New York and (most famously) in Hong Kong. Regular CTA riders can already use a transit card that is tied to their credit card or bank account. The thought is that the added convenience of card that can be used for other payments would sway over more users and reduce the number of riders using cash.
Cash, however, would still be taken so I am a little dubious that a new payment system will make a difference. Tourists and occasional riders will have reason to take on the card unless it really provides greater convenience independent of the CTA. Put another way, a tourist will use the card if they already have it in their wallet when they get to Chicago. But that says it is widely used already. It seems unlikely that the CTA can make that happen on its own.