E-money fare payments for the Sky Train system
BTS Group Holdings, the Stock Exchange of Thailand-listed company which runs the Bangkok Sky Train system, recently entered into a joint venture agreement with Line Corporation, the Japanese company which runs the popular Line mobile phone communication application, to develop a mobile payment system for Sky Train fares.
Given the congestion which can often be witnessed at the ticket dispensers for the Sky Train, especially at the main and most popular stations, it is likely the opportunity to set up an electronic payments system both online and in stores, as proposed by this joint venture, will be well received by commuters.
The joint venture is actually a fifty-fifty partnership between BTS Group Holdings subsidiary, Bangkok Smartcard System (BSS), and Line Corporation’s subsidiary, Line Biz Plus. The joint venture will have registered capital of 400 million baht.
BSS put 750 million baht into the joint venture, in exchange for a 50 percent share in Line Biz Plus, which will operate the Line Pay service. BSS is also the operator of Rabbit card, an e-money system, which can be used to pay for BTS Sky Train fares and other mass transit networks, as well as a limited number of additional retail services.
Line Pay allows Line users in Thailand to register their debit and/or credit cards on their accounts to make mobile payments both online and in stores.
Thailand has 33 million Line users while Rabbit card has also gained a solid footing within the offline payment services sector.
Line Pay will be renamed Rabbit Line Pay within the next few months to reflect the joint venture nature of the business. Line Pay was introduced into Thailand last year and since then has garnered 1.5 million users, while the BSS-controlled Rabbit card has attracted five million users since it was unveiled four years ago. The Rabbit card accounts for payments for around 20 million rides o the BTS Sky Train system per month.
At present there is an expectation within the two companies that around 40 percent of Line’s 33 million users (or 13.2 million users) will take up the Rabbit Line Pay system over the next two years.
Both companies agree that Thailand is looking more and more at trying to become a cashless society, and the proliferation of smartphones is certainly one factor which is key in achieving this goal. It is certainly government policy to push for greater usage of e-payments as a way of reducing the need for people to carry large amounts of cash.