Smart-card and card recharger


"Smart Cards" are machine-readable cards which contain a microchip, store data, and can support a range of fare collection and security functions. The 'intelligence' and functionality of the smart card depend largely on the capacity of the microchip, but also on the applications stored on it. The microchip ranges from simple memory to advanced processors.

Smartcard systems have largely been introduced for a number of objectives including:

  • to introduce new/extended fare products
  • to introduce stored value for fare payments
  • to facilitate integrated ticketing
  • to strengthen security and minimise fraud and revenue leakage
  • to minimise the need for short-lifespan paper type tickets,
  • to minimise cash handling for the customer and service provider
  • to increase the speed of passenger throughput at entrances and exits.

This system reduces costs in terms of waste from disposable tickets and ticket printing, as well as cash handling and transaction management requirements, while at the same time improving service usability and convenience.

Smartcard systems require three main infrastructural elements:

  • the Smartcards themselves.
  • card loading machines (which may be the ETMs) to add application and value to the card
  • card readers to acknowledge use of the service and, where relevant, to ‘deduct’ the appropriate fare from the card

Travel is authorized through the applications loaded on to the Smartcards. These typically consist of:

  • Stored value (‘electronic purse’), which is used in a similar manner to cash to pay for individual trips
  • Prepaid fare products, such as time-based passes and multi-trip tickets
  • Travel passes, such as concessionary passes for elders, employees passes, etc. that allow the user to travel based on an authorisation
  • Subscription or other personalised application, which is linked to post-travel billing, either of the customer or of a 3rd party

Smart cards are normally issued on one of three bases:

  • Disposable smart card, intended for limited use. These are pre-loaded with value/application and are disposed of when the value/time expires
  • Non-personalised reloadable card. These are intended for fare products that are not specific to the user, and may be used by multiple customers.
  • Personalised relodable cards. These are intended for use only by the designated holder, and suited to monthly/annual passes and concessionary passes. They may also be used for stored value.

Smart cards require an organisational and technical infrastructure for procurement, programming, issuing, adding applications, and adding value to the applications.

The technologies utilised for Smartcards can be grouped into two categories, contact and contactless. Contact systems connect to reader units by a direct physical connection to the conductive module on the surface of the card, whereas contactless systems interact with a reader unit using magnetic or electromagnetic field of a certain frequency which interacts with a radio antenna embedded in the card to transfer data. Contactless Smartcards typically have a range of approximately 10 cm. Smartcards do not have their own internal power source but derive their power from the card reader. In contactless systems, the card has an embedded wire loop which induces a current from the radio frequency field when it is in range of the reader, and this supplies energy to the card so that communication can occur. In contact systems, energy is derived via direct connection with the conductive pad on the surface of the card.

These interaction types allow for cards to be topped up at ETMs or to be validated at the Smartcard reader. Smartcard reader units are generally located at turnstiles, on platforms, or on vehicles. The reader unit reads information from the Smartcard, notes the card balance, deducts the appropriate fare, and writes the transaction result back onto the card to indicate payment completion. This calculation is performed based on fare information downloaded to the reader unit from a central computer system. All communication between the card and reader is encrypted, but before the communication exchange is allowed to take place, a mutual authentication between the card reader and the Smartcard, based on a shared access key, must take place. Transaction times range between 0.3 and 1 second allowing for very fast passenger throughput. The card readers cannot read more than one card at a time and generally have a default mechanism where they will not initiate communication when more than one card is in range.

Smartcards may be issued by the transport sector (transport authority, transport operator), by multi-provider schemes (e.g. urban authority, university campus, workplace), or by the banking sector. Cards issued by the transport sector or multi-provider schemes are generally viewed as private schemes, and are not subject to extensive regulation. By contrast, bank-issued cards are usually stored-value cards that can be used in a wide range of locations, and are essentially cash. They are hence subject to banking regulations and the requirements of a deposit-taking institution, and have much higher technical and organizational security requirements.


  • Fare collection
  • Customer service improvement

Benefits and cautions

Smartcard systems have a far higher memory capacity than magnetic stripe cards (typically between 1 and 64 Kb compared to 125 bytes) and hence can store applications and more data. They contain a chip that supports processing, applications and security functionality. This enables a wider range of fare products to be implemented. The authentication process and encrypted information transfer between card and reader provides information and cash balance security. While smart cards are more expensive to produce, they also have a far longer lifespan.

This type of system improves service usability and convenience for passengers, reduces costs and speeds up passenger throughput for operators. In addition, prepay systems provide cash recovery further in advance of the customer journey. Contactless systems provide faster transaction times than contact systems and may be a better option, but it is also possible to have a dual system using cards that contain both formats. In terms of whether open or closed loop systems are preferable, both have advantages. The primary considerations are that closed systems give the transport provider total control over the system, are less complex, and potentially more secure. Whereas open-loop systems spread implementation costs, improve data handling efficiency and service usability. Dual systems may be the most attractive, providing the greatest choice to customers and maximising benefits which also include further reductions in cash handling and paper ticket use.

Relevant case studies (please refer to the Fare Collection Toolkit)


(other relevant examples: London, Paris, Hong Kong, Singapore)