Contactless e-Purse Application Standard (CEPAS)

The innovative merger of two major card issuers in Singapore resulted in the Contactless e-Purse Application Standard (CEPAS) system.  This new system allowed for users to perform multiple transactions from different issuers on one single card.  Multiple payments, for example, taxi and rail transport, car park and bus usage could all be paid using this one card.

Major card Issuers in Singapore

      1.       Land Transport Authority (LTA)

a.       Monopolized the public transit market

b.      Promoted the launch of magnetic farecards

                                                               i.      Magnetic farecards were easily used

                                                             ii.      In Hong Kong, contactless smart cards allowed for commuters to use their farecards between different operators and networks with the fare values being prorated at the end of each day

                                                            iii.      EZ-Link cards allowed for tap-and-go card payments (owned by a subsidiary of LTA)

      2.       Network for Electronic Transfers Singapore (NETS)

a.       Dominated the private car park payment schemes and retail payments

b.      Was a pioneer in the establishment of the cashless payment platform

                                                               i.      Allow ATM cards to make consumer purchases and bill payments

                                                             ii.      CashCard allowed for parking fees and toll charges payments

c.       Major competitor amongst credit and debit cards as consumer purchases were allow at certain locations

The CEPAS initiative was to bring all these providers together into one single card and create the e-purse allowing users to use one card for all their transactions.  This goal was driven by the need to decrease the amount of cash used amongst the population.

CEPAS Plan

      1.       Merge multiple payment applications into one card

      2.       Minimize source duplications and created greater synergy

      3.       Allow multiple entities to create their own access keys in one single card

      4.       Designed with 3 commands – ReadPurse , Debit and Credit

      5.       Using EZ-Link cards together with the Magnetic Farecards and CashCards all in one

      6.       Offer exclusive deals through the NETS and EZ-Links loyalty program rewards cards

Benefits were visible right after the launch.  Users were pleased with their cards, the security provided by the used of individual keys which were translated into CashCard for transportation, Credit or Debit.  Viewing capability of their accounts online also increased interest.  Scope of fares were increased to include long-distance fares.  LTA experienced a substantial decrease of missed transactions due to transactions upload at the end of each day from the transportation departments. 

Barriers

      1.       Getting merchants to install new terminals to allow for such payments

a.       Merchants were given incentives in new terminals were installed

                                                               i.      Waived setup fees

                                                             ii.      Waived terminal rental fees

                                                            iii.      Locked and capped transaction fees

      2.       Consumers, mainly in the taxi sector, continued to use cash

a.       About 80% still used cash

                                                               i.      One of Singapore’s largest taxi cap operator launched a new contactless payment system which accepted all major cards

                                                             ii.      CEPAS cards were capped at S$0.30 per fare while others cards had a 10% charge added to the fare causing more consumers to want to use the a CEPAS card to decrease taxi fare charges

Overall the initiative was well planned out and key problems well addressed.  The solution to offer incentives and rewards in order to promote the usage of the new cards was the best solution for the CEPAS Initiative.