More Open-Loop Transit Payments Services to Launch in Taiwan

_{(This premium article was originally published in December 2019. © Mobility Payments and Forthwrite Media.)}

Taiwan’s airport train service will begin accepting Visa- and Mastercard-branded credit cards starting in January 2020, making it the second mass-transit service on the island nation to support open-loop payments for fares.

Country managers for the global payments network reportedly confirmed the new service this week, which will enable users, including foreigners, to use their contactless EMV credit cards or card credentials on NFC devices to tap to pay for rides. Other payments services, including QR code-based mobile payments of fares are expected on the airport line later. The plans for the open-loop service on the 51-kilometer airport line, called the Taoyuan Airport MRT, which opened in March 2017.  

The airport line already accept payments from Taiwan’s four interoperable closed-loop contactless stored-value cards, including EasyCard, along with single-use contactless plastic tokens and tourist cards.  

It’s the second metro service in Taiwan that supports open-loop payments, after transit officials in Taiwan’s third-largest city, Kaohsiung, began accepting Mastercard-branded credit cards on its two-line Kaohsiung Metro, known as the Kaohsiung MRT, in January 2019. Mastercard has a deal with the transit operator, Kaohsiung Rapid Transit Corp., which has allowed it to heavily promote its brand at Kaohsiung Metro stations this year. Contactless cards branded by China UnionPay have also been accepted since last January on the Kaohsiung MRT, though are not promoted. Cards in Apple Pay and Google Pay, along with Samsung Pay, are also accepted on the metro. 

Mastercard’s deal also is believed to have kept cards from Visa out this year, but Kaohsiung Rapid Transit in late September announced it had signed a deal that would allow it to accept Visa-branded credit cards and credentials on NFC devices by the end of the year. Kaohsiung will also accept JCB-branded cards then, as well, according to the plans. The Kaohsiung MRT had earlier added acceptance from QR code-based LINE Pay, a popular closed-loop retail mobile payments service in Taiwan. LINE Pay, owned by South Korea- and Japan-based messaging app provider Line Corp., announced earlier this month that in 2020, LINE Pay will become interoperable with LINE Pay services in Japan, South Korea and Thailand.  

While the Kaohsiung MRT is a small service, the various payments methods it will accept would make Kaohsiung Rapid Transit one of the few if only transit operators supporting four open-loop payments brands (Mastercard, UnionPay, Visa and JCB), along with a QR code-based payments service. 

Elsewhere in Taiwan, the Danhai Light Rail service that opened a year ago to the north of Taiwan’s capital, Taipei, is also expected to support open-loop contactless payments on its single line. 

Taiwan’s support for open-loop payments follows a global trend, with transit authorities and operators accepting contactless EMV cards and NFC devices, including those in London, New York, Singapore, Sydney and growing number of other cities.  

But some transit agencies and fare collection organizations are sticking with closed-loop payments of fares, and that appears to be the case for Taipei-based EasyCard Corp., the largest of the four major contactless store-valued payments services in Taiwan. EasyCard is used for transit and retail payments in the capital and around the country.  

EasyCard, which accounts for three-quarters of the roughly US$250 million in monthly spending with electronic stored-value cards in Taiwan, is reportedly planning to upgrade its Easy Wallet app to support NFC payments next year. It’s also been working with Samsung to support Mifare-based EasyCard in the Samsung Pay wallet. The latter service has been delayed and is now planned for launch during the first half of 2020. 

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