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Visa Navigate

July 2021


4 - 5 Minutes

Why it’s time to open the loop: urban mobility and the future of contactless travel

The shift to contactless payments is unrolling rapidly across urban transit networks, in a way that is unique to the sector. Visa examines emerging transit payment trends across Central and Eastern Europe, Middle East, and Africa (CEMEA) region and what they mean for the future of urban mobility.

Once, it was almost a rite of passage on arriving in a new city: learning to navigate its metro, train or bus system, not least how to pay for a ticket. These days, one aspect of the challenge has been removed in many places: simply tap a card to pay for your trip by bus, train or boat, although cash is still being widely used across a number of regions. But Visa believes that the future of public transport will be still more open, allowing travelers to tap in and out of turnstiles with the Visa card already in their wallet, or even linked to their phone or biometric ID, if they choose.

“It’s a secure, convenient method of payment,” says M. Tad Tilahun, Visa’s Senior Vice President and Head of Product & Solution Delivery for CEMEA. “If you use your own card when buying groceries, or coffee, it feels strange having to use cash or a “closed-loop card”. In transit especially, using an open loop card provides a more seamless experience for passengers who want to use their bank card for every transaction.”

The shift is already underway. In 2014, Transport for London, with Visa as its main partner, began allowing its passengers to make payments with their own contactless banking cards right at the gates, becoming the first public transport system across the world to implement “open loop” EMV contactless acceptance. Nowadays, cities across the CEMEA region, such as Moscow, Baku, Doha and Johannesburg are all embracing the “Pay-As-You-Go” model.

Everyone can get on board

The benefits can be many for consumers, public transit authorities and governments, not least in supporting the shift away from cash. Urban travel can help build the contactless habit with consumers – who, in the wake of the pandemic, are looking for ways to feel safer in public spaces. In the CEMEA region, consumers are still concerned about hygiene and do not want to wait in line to top up transport cards or have to pay cash. For example, 89% of consumers in the United Arab Emirates (UAE) said they would switch to paying for transit with a credit or debit card if that option was available1.

For transit authorities, allowing them to transition to an “open loop” system can offer savings and environmental benefits, as they avoid spending time, money and plastic issuing their own cards. For example, as much as 14 pence in every pound collected is spent on operating London’s “closed-loop” Oyster card system and an “open loop” scheme can be operated for less than 10 pence.2 Lastly, contactless travel systems support transparency around payments – particularly important for emerging markets keen to identify “grey money” (so far unrecognized by their tax systems) moving through their transit networks.

Crucially, the consumer need is there. “One of Visa’s studies across several Russian cities found the main barrier to using any transit system was the lack of clarity in how to pay, whether that was having the right change or correct travel card.3 Separately, 65% of surveyed consumers would prefer to make contactless payments as much as, or even more than, they are currently4,” says Michael Berner, Visa’s General Manager for Russia.

A new season for transit

The pandemic, too, is accelerating change here. As a result of consumer enthusiasm for contactless payments, transactions in the transit sector have risen even as people made fewer journeys. “In October 2020, we reached and even surpassed the historical maximum amount of contactless transactions in transport in Russia,” says Michael Berner. “So, even with a reduced ridership on a transit system – around 30 to 50 percent less than normal on the Moscow Metro, for example – the number of contactless taps grew.”

More specifically, new travel habits, as many consumers continue to work at least partly from home, mean they are less ready to buy season tickets. Here Visa has two solutions based on the Pay-As-You-Go approach: Known Fare Transactions (KFT), and Mobility and Transport Transactions (MTT). Allowing people to pay for their rides at the end of each day at the best fare rate, MTT has already been rolled out in Moscow, as well as London, New York, Singapore, and Rio. It all helps. The number of contactless cards used to make transit ticketing payments worldwide is expected to drastically increase from 24.8 million currently to 136.9 million.5

Contactless travel in CEMEA

Globally, Visa has 483 live urban mobility projects, of which 281 are in CEMEA, including initiatives in Russia, Ukraine, UAE and KSA. Today, Russia is the number one country globally in terms of the number of cities accepting contactless payments on their transit systems. That’s no surprise then, that Russia also sees the largest number of contactless transit transactions in the world. “Russian society is very receptive and hungry for innovations, and the introduction of contactless payments has been very successful. In 2016, Visa launched paying by phone and the adoption for this has been huge. Most transactions in Russia on transit are currently being made by phone, not by bank card”, said Berner. And the market has further to grow; Russia is digitizing its closed-loop travel systems, so that passengers will also be able to use their travel cards via phone, while the Moscow Metro has been piloting contactless payments through a facial recognition system.

Elsewhere, Visa supported a project in Azerbaijan which expanded contactless card payments to all stations on a busy railway connecting the capital Baku to nearby city, Sumgait. “This initiative was part of a state program to expand digital payments in Azerbaijan over 2018-2020 and illustrated how contactless journeys can be used to support wider digital drives,” says Vira Platonova, Visa’s Senior Vice President and Group Country Manager of CISSEE. According to the Central Bank, the number of contactless cards rocketed by 5.5 times to 4.6 million cards during this period.6

Of course, consumer readiness to embrace contactless travel – and how they prefer to do so – is not uniform. Some markets, such as Sub-Saharan Africa, need more development in this respect. While in the remaining markets across the Gulf Cooperation Council (GCC) and North Africa, Levant and Pakistan (NALP) region, Visa continues to lead efforts to enable EMV contactless cards with the first Visa exclusive implementation across GCC and NALP live with Mowasalat Bus in Doha. This will be followed up by go lives in the Kingdom of Saudi Arabia (KSA) and Morocco. “Visa’s Urban Mobility strategy also extends outside of acceptance in transit. In financial inclusion, as evidenced by opportunities in Dubai and Cairo, existing closed loop cards were converted to Visa Prepaid to cater for unbanked and underbanked passengers”, explains Neil Caldwell, Visa’s Senior Vice President and Head of Merchant Sales & Acquiring for CEMEA.

The secrets to success

Ultimately, payments solutions must be tailored to specific markets, which requires both collaboration – working and learning with and from one another – and tailored solutions that embody an in-depth understanding of local dynamics. In the same way, the benefits to each country, city or consumer, will hinge on their circumstances – but can be major and reach into other areas of urban planning. “Urban mobility is a tool with which we're helping each city and each country meet their respective needs,” says M. Tad Tilahun.

Stay current with the latest payments insights from Visa Navigate CEMEA – subscribe today.

All brand names, logos and/or trademarks are the property of their respective owners, are used for identification purposes only, and do not necessarily imply product endorsement or affiliation with Visa.

1 Commerce after COVID: Real Trends, Real Solutions, Visa, July 2021

2 How contactless travel will help transform urban mobility in a post-COVID world, Cities Today,

3 Future of Travel study, Ipsos Comcon, Visa, 2019,

4 The Visa Back to Business Study 2021 Outlook: Global Small Business and Consumer Insights, Visa,

5 Open-Loop EMV Contactless Payment Cards for Transit to Rise to over 136 Million by 2025, ABIresearch,

6 Visa, Azerbaijan Railways, the Central Bank of Azerbaijan and International Bank of Azerbaijan extend contactless payments on the suburban railways, ADY,

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