New York MTA sees smartcard fare system by 2015

New York City buses and subways will switch to "contactless" fare cards by 2015, a system that will be faster for riders to use and less costly than the current fare cards, the Metropolitan Transportation Authority said on Monday.

The MTA, the nation's biggest transit system with 8 million riders a day, now spends 15 cents on collection for every $1 in fares it takes in via the electronic MetroCards.

The contactless, or smart, cards rely on circuits that store data and communicate with terminals using radio waves, should be faster than the current cards, which must be swiped through a reader. Existing subway turnstiles would be rewired with new card readers.

The new system would also eliminate the need for riders to buy a special card just for transit.

"Even a small savings from that expense could save up to hundreds of millions of dollars annually," MTA spokesman Aaron Donovan said in a statement.

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The MTA's revenues suffered during the recent recession, because some of them are real estate-linked. The MTA since 2002 has raised transit fares and tolls on the bridges and tolls it operates by more than 50 percent -- twice the rate of inflation, the state comptroller's office said in testimony to a state senate committee on Friday.

"These increases represent a significant burden for most riders, particularly during an economic downturn," it said.

The electronic MetroCard technology is nearly 20 years old.

Under the contactless system, "You will use the credit or debit card already in your wallet to pay your fare, so you can skip those long lines at vending machines and stop worrying about having an 'insufficient fare,' since you can pay as you go," Donovan said.

The MTA first tested the contactless system, which would let riders use a credit card of their choice, last year.

Debit cards would not be accepted under the system, but riders could also purchase fare cards from vending machines.

In 2011, the MTA will start signing contracts for the work needed in preparation for installing the new fare system by 2015.

"MetroCard would not be phased out until the new system is ubiquitous on our subway and bus system," Donovan said.

The MTA's commuter rail lines would also at some point be switched over to the new contactless system, but no date has been set for that.