Contactless cards have the following benefits: 1) very high transaction speed to address high mass transit applications, 2) cheaper infrastructure (terminals) - with a 40% average lower than magnetic solutions, 3) much lower maintenance -a minimum of 17% lower than magnetic solutions, 4) superior ability to prevent fraud, 5) greater pricing structure flexibility, 6) ability to personalize and add new services.

1. Very High Transaction Speed
With a transaction speed of about 150ms for a typical transport application, contactless technologies are better suited than contact or magnetic technology to address very high volumes of traffic. Travellers do not need to insert the card into the reader thus dramatically increase boarding.

2. Capital Expenditure Savings
Contactless systems significantly reduce the initial investment cost, which must be analysed in conjunction with the maintenance cost.

3. Diminished Maintenance Costs
The magnetic infrastructure involves a physical interaction between the card and the reader therefore dirt, movement and physical contact creates wear and tear for the machine, both breaking the machine and dis-aligning it. For these reasons, the contactless smart card terminals which no longer have any electromechanical parts are 10 times more reliable than the magnetic ones. On average a magnetic reader can process 20,000 cards before it needs to be serviced. A busy subway station has in excess of 2,000 passengers per day per turnstile hence necessitating a maintenance call every 10 days. Maintenance ratios are thus reduced from between 12% and 15% for magnetic systems down to 8% for contactless ones. The robustness of the ticket remains an important differentiator of the contactless technology.

4. Fraud
Contactless technology plays an important role in mass transportation which does not have a barrier system (such as most buses). The high speed of transaction allows the operator to impose a systematic and immediate verification of tickets by giving a visible green signal upon entry to indicate whether a passenger has paid. This decreases the possibility of fraud. In addition, duplicating contactless smart cards is much more difficult than current magnetic strips or paper based tickets, therefore helping operators win their war against fraud.

5. Greater pricing structure flexibility
Due to their higher memory and processing capacities, contactless cards allow a flexibility in pricing which is unavailable to traditional magnetic cards. A mass transit provider has, for example, the possibility to charge different fares for different hours of the day or for different start and end points of a journey without changing the card.

6. Ability to expand into new services :

The ability to combine different applications on a smart card offered by contactless technology enables the mass transit operators to extend their support for customer relationship management (CRM), through the provision of customer loyalty schemes or customised combinations of services. Contactless card readers can process several types of cards which enables the operators to propose tickets/fare cards in conjunction with other offers (E-Purse, shopping card, loyalty schemes etc.) generating additional revenue streams.