Road Network Operations
& Intelligent Transport Systems
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Electronic Payment

One of the most successful applications of ITS is electronic payment (See Electronic Payment). Non-stop electronic payment supports payment of vehicle tolls on the go. Smart travel cards support fare payment for combined transport services (bus, rail, metro, river transport, parking).

Electronic payment applications integrate technologies for communications, data processing, data storage and microcomputing. The process comprises “front end” and “back-end” activities.

“Front-end” activities are those seen by the user. The most common “front-end” hardware technologies are smart cards, transponders (tags, such as the EZ-pass widely used for electronic toll collection in the USA), and – increasingly – smart phones.

“Back-end” activities are those related to payment processing, account maintenance, customer service and reporting.

Toll Tags

Electronic payment is widely used for collecting road tolls whilst the vehicle is in motion. The main components of the system are the transponder (also known as toll tags), the tag reader and the computer system for data processing. Most transponders use Radio Frequency Identification technology (RFID). There are two types of transponders: active and passive. Active transponders carry their own power supply (batteries), whereas passive transponders are powered by the radio frequency (RF) pulse they receive from the reader. Passive transponders are cheaper to buy but they have a shorter communication range and transit less data. Newer models of transponders are designed to allow for integration with smart cards (using built-in slots).

Fare Payment

Electronic fare payment systems are commonplace and offer a number of advantages over traditional payment methods:

  • convenience to public transport vehicle operators by making it simple to collect fares (for example with “touch and go” contactless payment cards);
  • passengers no longer have to worry about having the exact change ;
  • automation of on-the-go payment and collection of tolls and fares;
  • the option of more flexible fare structures.

There are two basic types of electronic fare payment systems: closed systems and open systems.

Closed systems are limited to one main purpose (such as paying transport fares) with perhaps a few additional add-on applications such as paying parking fees. The payment value stored on the card cannot be used on anything other than a pre-agreed and pre-defined activities.

Open systems can be used to pay for other purchases in addition to transport. An example is a credit or bank debit card which can be used with multiple merchants, but fare payment is not an attractive application for credit cards companies because the transactions are high volume and low-value.

Smart Cards

A smart card is a card which looks like a credit card in size and shape, but has an embedded microprocessor – in effect, replacing the magnetic strip on a credit card.

Smart cards facilitate the collection and management of payments using electronic media instead of cash or paper transfers. The system consists of two main components – a card and a card reader. Cards can be of the magnetic-stripe type where the reader does most of the data processing – or they can be equipped with a microprocessor, in which case, data processing can take place on the card itself (this is the more popular option).

Smart Card Ticketing

Smart cards can provide identification, authentication, data storage and application processing. Their use for electronic payments offers the traveller and the transport company/agency several benefits – including time savings, a more convenient payment method, the ability to implement more flexible but complex ticket pricing strategies, lower administrative costs, and better data for future planning. They also allow integrated ticketing strategies so the traveller can use a single card to pay for their transport – whether it be by bus, train, underground/metro/subway or ferries.

Smart cards can be of two types: contact smart cards and contactless smart cards:

  • contact smart cards have a small contact area made of several gold-plated contact pads, which provide electrical connectivity when inserted into a reader. The power is supplied by the card reader – so the card does not need to contain a battery;
  • contactless smart cards use Radio Frequency (RF) induction for communication and only need to be close to an antenna to communicate. Contactless smart cards also do not need an internal power source, but use an inductor to capture some of the RF interrogation signal.

Other Payment Technologies

A number of other technologies have been adapted for electronic payment – including DSRC/GNSS-based systems and automatic number plate recognition systems.

DSRC-based systems

These systems have been used for or urban tolling or a congestion charge, based on Dedicated Short Range Communication (DSRC) technologies. The standard microwave frequency of 5.8 GHz is used for communication between roadside transponders or antennas and in-vehicle devices.

GNSS-based systems

GNSS-based systems use Global Navigation Satellite System (GNSS) sensors inside the vehicles. This allows a wide range of pricing strategies to be implemented including strategies based on distances travelled. GNSS sensors record time and vehicle position data, which are then processed into trip information and matched against an established pricing scheme. The processing of the data can be performed at a central location or on-board the vehicle itself. The first successful demonstration of GNSS-based pricing systems took place in Germany on the A555 motorway between Bonn and Cologne.

Mobile phone payment

With the wide-spread adoption of smart phones, a number of apps have been developed where the smart phone can act as a payment device. An example is the “paybyphone” app to pay for tolls and parking (See

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