Transit Cards Market Size & Industry Share - Growth Trends & Forecasts (2023 - 2030)

Based on the Type :

The type segment is trifurcated into contactless transit cards, contact-based transit cards, and hybrid transit cards. Contactless transit cards accounted for the largest market share in 2022 and is also projected to witness the fastest CAGR during the forecast period. The growth of the market is endorsed by the advancements in technology including EMV technology (Europay, Mastercard, and Visa) to offer improved security of payment card transactions by using a chip embedded in transit cards. In addition, contactless transit cards have a plastic coating to offer durability and are highly accurate in calculating ticket fares. Subsequently, the aforementioned factors including enhanced durability, accuracy, and security are collectively contributing in boosting the growth of the transit cards market. For instance, in February 2022, Krungthai Bank and the Mass Rapid Transit Authority of Thailand partnered with Mastercard to introduce a contactless transit card for metropolitan rapid transit. The product is designed utilizing advanced EMW technology to enhance the security of transactions, hence contributing notably in promoting the growth of the transit cards market.

Based on the Product :

The product segment is bifurcated into bus cards and subway cards. Subway cards accounted for the largest market share in 2022 as subways serve as the fastest mode of transportation for commuters to travel from one location to another. Transit cards offer seamless payment and additional benefits to customers for rail travel including surplus discounts, accelerating the growth of the market. In addition, the ability of transit cards to streamline the commuter traveling experience to avoid waiting in long queues further promotes the growth of the market. In conclusion, the expanding subway sector coupled with the aforementioned benefits offered by the transit cards are majorly responsible for bolstering the growth of the market. For instance, in March 2023, HDFC Bank collaborated with Indian Railway Catering and Tourism Corporation Ltd. (IRCTC) to launch a transit card to offer convenience to passengers traveling by Indian railways. The card offers several additional benefits to commuters including joining bonus points and discounts hence, contributing notably in fueling the growth of the transit cards market.

Bus stations are predicted to register the fastest CAGR in the transit cards market during the forecast period. The growth of the market is credited to the advancements in technology such as the emergence of the AFC system that collects transportation data to estimate destination matrices. In addition, the transit cards offer accessibility, particularly to elderly people to scan the card by simply placing it on the scanning screen. Consequently, the advancements in technology and the capability of transit cards to offer enhanced benefits, particularly to senior citizens, are projected to drive the market growth in upcoming years.

Based on the Application :

The application segment is categorized into transportation, traffic management, parking, and others. The transportation sector accounted for the largest market share of 32.89% in 2022 owing to the increasing urban passenger mobility at subway stations and bus stations. The surge in the number of passengers leads to passenger traffic at boarding stations resulting in long queues for buying tickets. The emergence of advanced contactless transit cards creates a more convenient and pleasant experience for passengers by reducing waiting time and paper ticket usage. Consequently, the increasing urban passenger mobility and the emergence of advanced contactless transit cards are the major factors responsible for propelling the growth of the market. For instance, in September 2022, Mastercard partnered with Finaro and Fertagus to launch a contactless transit card for railway applications in Lisbon. The card is introduced to offer convenience to more than 90,000 passengers who use the suburban trains between the South Bank and Lisbon.

The traffic management system is projected to witness the fastest CAGR in the transit cards market during the forecast period. Transit cards assist in reducing passenger congestion at bus stops and railway stations and streamline the ticket-purchasing process. Additionally, transit cards also provide real-time passenger data including passenger ticket number and boarding patterns. The data collected is utilized by transport operators to optimize the routes and schedules, thus resulting in reduced traffic congestion and improving the efficiency of the traffic management system. In conclusion, the ability of transit cards to provide real-time data to transport operators is expected to drive the market growth in upcoming years.

Based on the Region :

The regional segment includes North America, Europe, Asia Pacific, Middle East and Africa, and Latin America.

Europe accounted for the largest revenue share in 2022. The growth is attributed to the increasing adoption of contactless technology and the shift in the urban commuter mindset. Additionally, the region has a vast network of transportation including railways and buses that further drives the market growth by reducing passenger queuing time at ticket counters, hence offering convenience to passengers. For instance, in 7 April 2022, according to Statistisches Bundesamt, approximately 7.88 billion passengers in Germany traveled by trains and buses in 2021 showcasing a rise of 4% in comparison to 2020. The rise in the number of passengers traveling by trains and buses increases the demand for transit cards which in turn promotes market growth.

Moreover, increasing investments by the government in improving the public transport infrastructure also contributes considerably in accelerating the market growth. Consequently, the expanding railway sector, adoption of advanced technologies, and increasing investment by the government are the key factors responsible for driving the growth of the transit cards market in the region. For instance, in 20 July 2022, according to HM Treasury, the United Kingdom government spent almost USD 8.6 Billion to improve the local public transport infrastructure including the installation of ticket vending machines, high-quality display boards, and transit card-based contactless payments. The increasing government investments in enhancing the public transport infrastructure, thus act as a major factor in promoting the growth of the market.

Asia Pacific was valued at USD 16.65 billion in 2022 and is projected to reach USD 29.91 billion by 2030 with growing CAGR of 7.6% during 2023 to 2030. In addition, in the region, China accounted for the maximum revenue share of 26.7% in the year 2022. The growth in the region is attributed to the increasing investment in upgrading the infrastructure in countries namely China, India, and Japan. In addition, the rising demand for public transportation and surge in the train passengers is expected to fuel the market growth in upcoming years. For instance, in August 2022, according to the Philippine National Railways, the total number of travelers carried by the Philippine National Railways accounted to 3.8 million in 2021, and the majority of the passengers were carried by the Metro South commuter service. Consequently, the expansion in the transportation industry is projected to drive the market growth in Asia Pacific countries in upcoming years.