Home / Cash, Money, Taxis: Competition for NYC Taxi Payment Systems Heats Up

Cash, Money, Taxis: Competition for NYC Taxi Payment Systems Heats Up

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Although London’s black taxis have been voted the best in the world, nothing beats the convenience of a New York City yellow cab. It only ever takes a moment to hail one (usually), and payment is as easy as swiping a card (most of the time).

While this may seem like the pinnacle of a convenient cab ride, the payment method for NYC yellow cabs is on the brink of another major overhaul. What’s more, the competition for that new payment method is heating up, with a score of heavy hitters vying for the honor of representing New York City cabs.

In one corner sits the mobile payment company famous for its dongles that plug into smartphones and tablets founded by Twitter’s Jack Dorsey: Square. Square’s vision of a utopian cab payment system is a sleek plastic-encased iPad fitted with a Square card swiper attached. Square is testing out the iPad payment system in 30 cabs NYC cabs already.Square Payment System for NYC Cabs

The major difference between Square’s proposed method and the current touch screens (which, for the record, were a huge deal in 2006 when they rolled out) is that riders can swipe at any time to pay, and payments are made more quickly to drivers. Additionally, Square’s proposal includes drivers using an iPhone app to add tolls and communicate with dispatch.

In the other corner is a group of companies with a different concept: they’re getting rid of card swiping entirely. Taxi Magic, although not yet available in New York, is a mobile app that lets you schedule a taxicab to pick you up immediately, or at a later date, then charge the ride to a credit card you’ve already saved within the app. Similarly, Uber has a sleek mobile app that lets you schedule cab rides and pay for them with a credit card, no swiping involved. With Uber, however, you can only schedule rides with Uber’s fleet of specialty cars.

Then, of course, we can’t discount another form of mobile payment that’s vying for attention as well: Google Wallet. Like Taxi Magic and Uber, Google’s mobile payment system envisions paying without swiping, as the Verge demonstrates in this NYC cab ride. While Google Wallet is a mobile payment technology that takes plastic cards entirely out of the picture, the limited user base is a huge disadvantage: millions of iPhone users, and anyone else not using a Sprint Nexus smartphone, don’t have access.

Still, things seem to be looking up for NYC cabs, and this next round of innovation will continue to impress. However, we might have some catching up to do with our friends across the ocean. Given Londoners are tweeting for their cabs with TLC Taxi (Tweet a London Cab), should NYC cabbies be in line for social media training and netiquette classes to catch up?

Who do you see – or would like to see – win the NYC mobile taxi payment race?

What's the Future of Google Wallet?

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About Thomas Samph

  • I think that would be a great idea to coordinate the payment systems. Credit that you put towards a Metrocard could be used in cabs as well.

    But New York needs to update the Metrocard system, I think. The payment method for public transportation in other cities, like Boston’s Charlie Card, the Oyster Card in London and the Navigo in Paris, would be better for cab payment. Those payment systems are more along the lines of what Square and Google Wallet are doing with mobile payment; no swiping.

    That kind of payment method would be better for both public transportation and cabs.

  • Why not just use the subway Metrocard for payments to a taxi?

  • Thanks for your comments!

    @TweetaLondonCab – 12% is crazy. I’ll have to check out @iZettle, never heard of them.

    @NewYorker – I’ve had great experiences in New York in cabs generally, even paying with a card. Maybe Square’s payment system will take a lower percentage of the transaction if they end up being the common provider: it’s only about 2% for other transactions right now. I use to live in Boston and had a terrible time with drivers refusing to accept cards when they got the machines. Apparently the card machines were a really bad deal for the drivers.

  • NewYorker

    NY cabs are all supposed to take cards but all of them will moan and kick up a fuss if you try to due to the extortionate charges levied on them directly.

  • Lee @tweetaLondoncab

    Thanks for the mention. Card fees are somewhat of a crusade of ours in London with passengers typically being charged 12.5% when using a card in a taxi here. We at TLCtaxi are desperate for @square or @iZettle to launch in the U.K.