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Metra officials have their panties in a wad, but commuters will be singing for joy: beginning in September, Metra will begin accepting credit cards for monthly passes and 10-ride tickets. Thank you Sen. Michael Bond (D-Grayslake) for pushing through legislation that now requires Metra to accept credit cards.
While a convenience for customers, Metra will be paying a price -- to the tune of $3 to $5 million in transaction fees that are expected, along with $2.2 million in up-front capital costs. Metra has resisted the change due to costs, reportedly, and Metra Board member Jack Schaffer commented that unfunded mandates from Springfield are “a tradition.”
Riders who use “Transit Checks” obtained through their employers will not be able use credit cards with the checks, however. [WBBM]
Metra South Shore image by Merrick Brown.
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Welcome to the 90s Metra!
im sure now everyone will bitch that ticket prices go up to compensate for the transaction fees
seriously, how did people survive before plastic? I understand the convenience factor, but if you're buying a monthly pass its really not that hard to pay with a check...
Via,
What you seem to overlook is that Metra is a taxpayer supported government agency. They are accountable to us. Their lack of willingness to modernize means they are not operating efficiantly. I think most of the people complaining about Metra's lack of movement on this do so for that reason more than because the cash only policy may be less convenient for them. As far as I know, every other legal business that is at least one-fiftieth Metra's size acccepts credit cards. They have all determined that the revenue generated from increased business and the amount saved on processing costs (remember it costs money to count cash and take it to a bank) makes up for the small transaction fees. Do you really believe that Metra is right and they are all wrong?
MK- The fees may be "small" but multiply them by millions of transactions, and pretty soon you're talking about some serious pocket change. The difference has to come from somewhere, and seeing as how the state isnt going to step in and fund the gap, you can be sure it will lead to higher ticket prices. Personally, in this day and age I find it refreshing that a government agency has chosen to take the "slow and steady" approach.
And Shasta- plenty of people don't like paying with credit, me being one. It forces me to be more careful with my purchases, and I have a different psychological approach to spending when I have to write the entire amount out, or physically hand over the money itself
Via,
There is not going to be a revenue loss from Metra accepting credit cards. In fact, there will almost certainly be a revenue gain. There is no fare increase needed to make up for the transaction fees. Many people (no doubt small in percentage terms but significant nonetheless) end up not using Metra because of their cash only policy. For example, a person may decide to take a Metra train but realize that they don't have enough cash on them. It is 2009. Many people don't carry a significant amount of cash or certainly any checks. And their bank may not have an ATM nearby (and they may want to avoid the ATM fees from using another machine) so they will just decide not to take the train. When Metra accepts credit cards, the undoubtadly thousands of potential passengers in scenerios like this will take the train. This means more revenue. If credit cards cause one person to purchase a $60 ten-ride or monthly ticket, how many 2 to 3% transaction fees will it take to make up for that increase in revenue? Do the math. Clearly the revenue that will be generated from attracting more passenger will offset the increase in cost from the transaction fee. Not to mention, there are also cost savings from needing to process less cash. Ultimetely, the use of mmachines should mean the hiring of considerably fewer ticket agents (remember there are currently hundreds of stations in the suburbs that have ticket agents on duty every morning). The argument that accepting credit cards would create a cost that needs to be passed on to passengers is ridiculous. In my opinion, Metra's leadership are not the smartest bunch of people in the world. They don't seem to understand the most basic things about managing an organization like Metra.
"...so they will just decide not to take the train."
So do they do, then? "I don't feel like going to an ATM, so I don't think I'll go home today."
Yeah, that's a pretty weak argument, I am one who thinks Metra should have started accepting cards years ago. Yes, consumers will have to indirectly eat the cost of accepting cards, but the vast majority of us already do that in most other retail situations whether we know it or not. At least Metra has a relatively large volume of customers, driving down those individual indirect costs.
"So do they do, then? "I don't feel like going to an ATM, so I don't think I'll go home today."
No, they may say "it will cost only a little more (considering the ATM surcharges) and get me home quicker, so I'll just take a cab." Or if they are going to work they may decide to drive, particularly if they don't work downtown and have to ability to park inexpensively. Obviously, the overwhelming majority of people are not deterred by the cash only policy. But it doesn't have to be a high percentage of people for it to easilly make up for any 2 to 3% transaction fees. Every other business takes credit cards. They do so because they have come to the conclusion that they gain more revenue than they loss. Otherwise they wouldn't accept them. Why do people think they are all wrong and Metra is right?
"Why do people think they are all wrong and Metra is right?"
It's not a question of who's wrong or right, although I personally tend not to jump off bridges others jump from. Many, many stupid things have been popular.
And really, I'd like to know where a person would live so that taking a cab would be cheaper than a metra ticket and a two or three dollar ATM fee. I can't see that math working out.
So do you still barter?
OK. I don't necessarily care. "Inconvient" for me typically means I'm lazy or ill-prepared. Has Metra or anyone else come out with the numbers on this?
Does ANYONE write checks anymore?
There is no way that checks save Metra money. I like Metra, but Really. If the CTA can link your credit card to your CTA pass, certainly Metra can at least accept them.
Metra is great, but really inefficient. I can't tell you the number of times conductors have failed to collect my fare just because the train was too crowded.
Well, I write a check for rent and for my car payment. I was writing checks for car insurance, but switched that to auto-pay... I actually get a certain sense of satisfaction out of writing checks, despite the occasional inconvenience of it. And we have cool checks. They're Toy Story. :)