Paying a transit fare by tapping the bank card or phone you already own, instead of a card the transit agency issues and controls.
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Most transit fares are closed-loop: the agency issues the card, controls it and holds the money on it — Hong Kong's Octopus has worked that way since 1997, as Boston's CharlieCard and Toronto's PRESTO still do. Open-loop fare payment inverts that. You tap the contactless bank card or phone you already carry, and the gate behaves like a shop's payment terminal.
The agency then stops issuing cards, running top-up machines and holding balances. London proved the model — bank cards on buses from December 2012 and the Tube from September 2014, with an account-based back office that caps daily and weekly spend. Others switched faster: four Kansai railways, Osaka Metro among them, opened 548 stations to bank cards on a single day in October 2024, and in Mexico City an ordinary card has opened every Metro turnstile since that same month — the magnetic paper ticket, sold since 1969, ended in March 2024.
A bank card is only an identifier, though, and on its own it cannot express the fare products people depend on. Osaka bills every tap at the adult fare; child fares are not supported. Mexico City has no cap and no pass, and stored value on its own card expires 300 days after the last use. Capping and concessions live in the account-based back office — the expensive part cities are tempted to postpone. Open loop also moves the fare record to a payment processor. See also e-ticketing.
Added 2026-08-01 · Part of the growing Smart City Glossary