Will card payments be a credit to the black cab trade?

payment cards

 

Card payments a credit to the black cab trade

Around half of London’s black cabs do not have the technologies in place to pay by card.

Soon it will not be necessary for passengers to leap out of the cab mid-journey to withdraw money from the nearest cash machine. By 2016, cabbies may be forced into accepting card payments in plans unveiled by Transport for London in July 2014. Currently, although some cabs do accept card payments for passengers’ convenience, around half do not and cite the cost of installing and maintaining a card machine as the main deterrent.

Taxi's Accepting Card Payments

Although accepting card payments would mean that drivers would subsequently be carrying on their persons less money and that would lower the risks of being robbed, there have been objections raised within the cab industry, as Transport for London would scrap the 6% card surcharge which would be absorbed into the fare price. This would mean an approximate rise of 6% in metered fare prices, yet Transport for London, the body responsible for regulating transport fares in London, would most likely only allow for a 1% rise in fare prices, resulting in the remaining 5% being unaccounted for and the cab driver running at a loss.  Leon Daniels, TfL’s Managing Director of Surface Transport said of the surcharge last year "The proposal would also see card transaction fees considered when we calculate overall taxis fares - meaning that passengers would pay the same fare regardless of how they chose to pay. The proposal will be discussed at the TfL Board in September and would be subject to a public consultation.”  

This comes as a further blow for cab drivers after being informed that by the 1st January 2018, all new taxis must have the capability of running in zero-emission mode and when driving through London’s most polluted areas it is expected that this mode is utilised. Therefore cab drivers will be expected to pay more for greener vehicles.   

Some cab drivers have embraced new technologies however, with one even going as far as to trial only accepting payment via a mobile phone app named Pingit. Pingit is a Barclays app but can accept card payments from any British bank which is a member of the Paym network. Passengers just need to download the app to their phone and then send a text to the driver’s phone to pay their fare. Ian Cable, a London black cab driver, decided to trial the Pingit app as he was tired of risking a £60 fine by illegally stopping and waiting so that his passenger could withdraw cash.

We’re interested to see how the potential introduction of mandatory card machines in taxis would turn out. Here at Tradex we’ve been providing taxi insurance for some 60 years under the Westminster brand and have seen the black cab industry evolve during this time. 

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