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Credit cards and cabs: New device may make it easier for taxi passengers to pay with plastic
Credit cards and cabs: New device may make it easier for taxi
passengers to pay with plastic
Gadgets to let riders pay with credit, debit cards from seat
Jon Hilkevitch
Getting Around
June 22, 2009
The refusal of some Chicago taxicab drivers to accept credit cards
leads to hundreds of complaints to city officials each year, ranking
third behind reckless driving and rude behavior, records show.
And taxi industry executives say the aversion to plastic among
cabdrivers is actually the No. 1 complaint they receive. "The biggest
thing I've heard from the public is the driver doesn't want to accept
credit cards," said Jeffrey Feldman, president of Taxi Medallion
Management, LLC.
But now, officials hope new touch-screen equipment being installed in
the back seats of up to 2,600 Chicago taxicabs will help address the
problem.
The devices give passengers the option to swipe credit or debit cards
instead of handing over the cards, or cash, to the driver.
The TV-like screen presents a running tab during the trip and, at the
end of the ride, an itemized bill generated by the cab meter,
including any surcharges and tolls. It also lets customers add a tip
onto their charge card. The screen displays suggested gratuities
corresponding to rates of 15 percent, 20 percent and 25 percent. The
customer can instead use a keypad to enter a different tip amount, or
provide a cash tip if desired.
The technology will likely take away a ploy carried out by
unscrupulous drivers -- a minority among the city's 15,000 taxi
drivers -- who pretend the credit-card processing machine in the front
of their cab is broken.
That con game was attempted against your Getting Around reporter
recently on a $60 ride home from Midway Airport. Miraculously (or
not), the driver was able to "fix" the credit card machine when his
unfazed customer simply refused to pony up cash.
Driving a taxi is a tough way to scratch out a living. It explains why
some drivers attempt to demand cash from their customers to avoid
losing the 5 percent that credit card companies skim off the top of
each fare transaction.
There's another benefit to the back-seat displays. The touch-screen
computers, equipped with Google Maps software, enable passengers to
monitor their trip from pickup to drop-off. The mapping system tracks
each cab trip and can be used as a navigation tool by passengers,
making it obvious if a cabbie intentionally takes a longer route for
no reason other than to inflate the fare. The trick falls under the
heading of cab overcharges, which generated more than 600 complaints
to the city in 2008.
Meanwhile, fare transactions using the swipe-card technology are
processed in three seconds on average, according to Creative Mobile
Technologies, a New York-based company that produced the touch-screen
equipment for taxis in New York City, Boston and now Chicago.
"Customers love swiping the credit card because it's fast and easy,
and sometimes the tips are better," said Amadou Barry, 37, who has
been driving Yellow Cab taxis for three years.
In New York, tips to drivers increased after the card technology was
introduced in 2008, according to the city's taxi and limousine
commission.
A study by Visa Inc. showed that New York cabdrivers are receiving a
22 percent tip on average when credit or debit cards are used, versus
a 15 percent tip on cash fare payments, said Tad Fordyce, a Visa
product development expert.
"This technology is a good move for corporate card customers. It
provides a choice so they can save money by not having to take a
limousine as often," Fordyce said.
Chicago taxi drivers have been required to accept credit or debit card
payments for years, although Norma Reyes said the rule was not tightly
enforced until she was appointed commissioner in 2004 of the Chicago
Department of Business Affairs and Consumer Protection, which
regulates the taxicab industry in Chicago.
The taxi industry has been one of the last transportation businesses
to accept credit cards, Reyes said, adding that the transition is long
overdue because the issues are safety and convenience.
"Taxi drivers are the targets of crimes because they work alone and
they work with cash," Reyes said. "I think that will change once the
message gets out the cabdrivers are not carrying so much cash."
About 30 Chicago taxis are equipped with the touch-screen payment method.
Starting in July, the devices will be installed in about 760 Yellow,
Checker Taxi and Blue Diamond Taxi cabs managed by Taxi Medallion
Management, Feldman said.
Plans call for expanding the program to cover all the 2,600 taxis in
the Yellow fleet, he said.
There are about 6,700 taxis registered with active city medallions in
Chicago, Reyes said.
Veteran taxi driver Wale Ajose said he likes the back seat technology
because it helps minimize potential disputes with customers.
"It doesn't give you a hard time," said Ajose, 50, a driver for
Yellow. "The old system takes several minutes to process the credit
card. Customers complain, 'What's taking you so long?' The back-seat
swipe card is very, very fast."
However, Ajose said he does worry that more customers will switch from
cash to credit cards, which will affect his earnings because of the 5
percent service charge the credit card companies impose.
Creative Mobile Technologies is providing the touch screens free of
charge to taxicab companies in all three U.S. cities in exchange for
rights to generate revenue from on-screen advertising, officials said.
Already, some Chicago taxi riders are experimenting with the screen
prompts to see what the technology can do.
"Kids love to play with the touch screen," Barry said. "They ask me if
they can turn on cartoons. One boy asks me, 'Where are the dinosaurs?'
I say, 'Not yet.' "
Programming, including local Chicago news, sports, entertainment,
restaurant listings and tourist information, is still in the works,
along, of course, with advertising, said Jesse Davis, president of
Creative Mobile Technologies, which was founded in 2005 in response to
a mandate in New York requiring the technology in all Big Apple taxis.
Passengers in Chicago have the option to hit the mute button on the
screens during rides if they prefer.
That was done after "I received phone calls from irate elderly
customers who did not want to listen to the music offered," Feldman
said.
Reyes' department has received 298 taxi customer complaints in
connection with credit cards in the first five months of 2009,
compared with 376 in the same period last year. More than 900 such
complaints were logged in all of 2008.
Reckless driving complaints about cabdrivers topped the list, with
more than 2,400 received last year.
No. 2 was rude drivers, with more than 1,200 complaints in 2008.
Cab customers in Chicago will flock to the technology because their
credit or debit card transactions are secure, Davis said.
"The driver has zero interaction. It amounts to total rear-seat
control," he said.
Contact Getting Around at jhilkevitch@tribune.com or c/o the Chicago
Tribune, 435 N. Michigan Ave., Chicago, IL 60611.
Copyright © 2009, Chicago Tribune
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