San Francisco's public transit riders may soon be able to pay for Muni Metro rides with their smartphones.

The San Francisco Municipal Transit Agency is in negotiations with vendors to build a mobile app that can take payments and replace fare cards for the Muni light rail system, two agency officials told BI Intelligence, Business Insider's subscription research service.

Software firm GlobeSherpa is under consideration for the project, which could be finalized as soon as this month, say those officials and a GlobeSherpa executive, who requested not to be named because a contract is not yet finalized.

GlobeSherpa has already rolled out a ticketing app utilizing QR codes for Portland's TriMet transit agency, and last month won a contract to expand the Portland app to accept smartphone tickets using contactless NFC and Bluetooth Low Energy technology.

As the illustration below shows, fares are paid within the Portland app, including 14-day and monthlong passes. The app can then display a ticket with a QR code on the phone screen, which allows bus operators or fare collectors to accept the e-ticket.

GlobeSherpa's mobile ticketing app for Portland's TriMet transit system. ISITE Design

San Francisco's Muni already utilizes contactless fare collection for its Clipper Card smart fare cards (contactless cards are waved or tapped at a terminal instead of being fed into a reader). This technology could be adapted to NFC-capable smartphones, according to the GlobeSherpa executive.

San Francisco's proposed project could raise the profile of mobile payments — and do so in a center of financial technology innovation and investment.

Other U.S. transit agencies, including Boston and Newark's regional commuter systems, have rolled out smartphone ticketing, touting increased customer convenience and lower equipment costs on fare card vending machines, which can cost as much as $50,000.

But the Muni's roughly 700,000 daily riders would make it one of the largest U.S. municipal transit agencies to implement smartphone ticketing.



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