As public transportation systems evolve, ensuring equitable access while maintaining operational efficiency has become a top priority for transit agencies. One of the most transformative tools helping agencies achieve this balance is fare capping. By guaranteeing that no rider overpays for their journeys, fare capping creates a more inclusive, fair, and streamlined system that benefits both passengers and agencies.
What Is Fare Capping?
At its core, fare capping is a policy that automatically limits how much a rider pays over a given period—typically daily, weekly, or monthly. Rather than requiring riders to purchase upfront passes to access discounted fares, fare capping lets riders pay as they go and ensures they never spend more than the price of a period pass.
For example, a rider using pay-as-you-go fares would hit a spending limit at the equivalent cost of a daily or weekly pass, after which no further charges are applied. This means all riders—whether they purchase single fares or frequent commuters—receive the same discounts without needing to make an upfront financial commitment.
Fare capping functionality usually comes as part of an Account-Based Ticketing (ABT) system, which allows riders to use smartphones, smart cards, or contactless payment methods to automatically track and cap their spending.
Why Transit Agencies Are Embracing Fare Capping
Transit agencies globally have increasingly adopted fare capping to tackle some of the most persistent issues in public transit: equity, revenue management, and rider experience. Here’s why it’s become a game changer:
- Equity for Riders: Fare capping ensures that all riders, regardless of their financial situation, pay the same amount for their travel. Riders no longer need to predict how much they will travel in a month or afford expensive upfront passes. Instead, they receive the best fare automatically, benefiting occasional riders and low-income individuals who may not be able to prepay for travel.
- Revenue Impact: Although fare capping may initially seem like it could reduce revenue, many agencies find that the system pays for itself through increased ridership, reduced fare evasion, and lower cash-handling costs. In fact, in a recent report called ‘The app or the cap?’, published in the journal Transport Policy, researchers at the University of Tennessee examined how new fare technology and fare policies affect overall ridership numbers for transit agencies in the US. The results were clear with every US transit agency studied in the report experiencing an increase in ridership when they expanded their fare-capping options to include monthly passes by 3.6%-4.1%.
- Enhanced Rider Experience: Fare capping simplifies the transit experience by reducing the need for riders to calculate their travel costs or buy different fare products. By minimizing fare selection, fare disputes and ensuring that riders always pay the lowest price, agencies report smoother operations and improved rider satisfaction.
Planning for Fare Capping: What Agencies Need to Know
Implementing fare capping offers more equitable and cost-effective travel, but successful deployment requires careful planning. Educating riders and operators is key to a successful launch with a comprehensive awareness and educational marketing campaign, focusing on:
- Clear Messaging: Use simple, consistent communications across all channels to explain fare capping and its benefits.
- Progress Tracking: Show riders how close they are to reaching their fare cap through apps or via online portals.
- Operator Training: Prepare operators with training and tools to handle fare capping queries smoothly.
- Gather Feedback: Use rider and operator input to fine-tune the system for a smoother launch.
Effective fare-capping planning ensures a seamless, equitable experience for riders while helping agencies optimize their fare systems.
Want to Learn More? Unlock our Fare Capping White Paper
For a comprehensive look at how fare capping can transform your transit system—improving equity, rider experience, and efficiency—download our in-depth white paper, Bridging the Fare Gap: Unlocking Equity and Efficiency Through Fare Capping in Public Transit.
This resource offers real-world examples, strategies for successful implementation, and best practices to guide your agency on its fare-capping journey.
Topics covered include:
- What is fare capping?
- To cap or not to cap?
- Equity
- Revenue Impact
- Rider Experience Opportunities
- How Can Masabi Support Your Journey to Fare Capping?
- Planning
- Procurement
- Delivering / Implementation
- Rider Outreach and Marketing
👉 Download the White Paper Now and discover how fare capping can work for your transit agency.
How Masabi Can Help
As a leader in fare payment solutions, Masabi’s Justride platform provides the expertise and tools needed to help agencies implement fare capping effectively. From initial planning to outreach and education, Masabi can support transit providers through each phase of the fare-capping journey. Masabi’s solutions are designed to be flexible and scalable, ensuring that agencies of all sizes can benefit from cutting-edge fare technology.
Want to learn more? Request a demo.
