The global Transit Cards Market is estimated to be valued at US$ 75.1425 Bn or Mn in 2023 and is expected to exhibit a CAGR of 7.5% over the forecast period from 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
Transit cards are primarily used for making electronic payments for transportation services including buses, trains, metros and other public transport systems. Traditional transit cards store data on magnetic strips while smart transit cards have an embedded chip that can store more information and allow for contactless payments. Smart transit cards offer several advantages such as faster processing, ability to store fare balances and travel histories, integration with multiple transit modes and opportunity for value-added services. With growing urbanization and adoption of smart payment technologies, transition towards smart transit cards is being seen across major cities globally in order to improve the passenger experience. Furthermore, smart city initiatives by governments are also supporting the deployment of smart transit infrastructure.
Market key trends:
The transit cards market is witnessing a rising trend of open payment systems which allow passengers to use multiple payment options like debit/credit cards, mobile wallets, QR codes etc. for fare transactions instead of requiring a transit-specific card. This provides more flexibility and convenience to users.Another key trend is the integration of transit cards with non-transit services. For example, some smart cards can be linked with loyalty programs, offer discounts at retailer partners or function as digital IDs. This is aimed at enhancing the value proposition for passengers. Furthermore, developments in near-field communication (NFC) technology have enabled banking apps and mobile wallets to emulate a transit card for contactless payments. While this poses competition, it has also augmented the transition to open payment systems. With growing global priorities around sustainability, transit operators are also exploring eco-friendly card materials like recyclable plastics.
Porter’s Analysis
Threat of new entrants: Low-medium due to high initial investments required to set up fare collection infrastructure and establish partnerships with transit operators.
Bargaining power of buyers: Medium. Transit agencies have bargaining power due to bulk buying but suppliers have strong brands and relationships.
Bargaining power of suppliers: Medium-high. Major suppliers have established positions, proprietary technologies and capabilities to supply complex requirements.
Threat of new substitutes: Low. No direct substitute for transit cards currently exists with the same functionality.
Competitive rivalry: High. Major global players compete intensely on technology, solutions and pricing.
Key Takeaways
The global Transit Cards Market is expected to witness high growth, exhibiting CAGR of 7.5% over the forecast period, due to increasing urbanization and development of large public transit systems globally. The market size for 2023 is estimated at US$ 75.1425 BN.
Regional analysis: Asia Pacific region is expected to dominate the market growing at over 8% CAGR during the forecast period. China, Japan and India are experiencing highest ridership growth in metro and bus systems driving demand.
Key players operating in the Transit Cards Market are Datacard Group, Gemalto N.V, Giesecke & Devrient GmbH, Beijing Watchdata Co., Ltd. Cardlogix Corporation, Infineon Technologies AG, Eastcompeace Smart Card Co., Ltd, and 4G Identity Solutions Pvt.