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4 Smartcard Interoperability Issues for the Transit Industry 1.1 Interoperability Defined For this research project, TRB defines interoperability as "the ability of different agencies to coordinate and share information so that passengers can travel in a seamless fashion." Travel may occur on public transit, on a toll road or toll bridge; it may include the use of a parking facility. Travel in a seamless fashion is primarily driven by these factors: Coordination of transfer points; Schedule coordination; Simplified and coordinated tariff structures; Transfer facilities design; Consistent passenger processes and operational procedures, Boarding, Fare payment, and Fare inspection; Common interoperable fare media; and Convenience in obtaining fare or payment media. As the previous list of factors indicates, fare payment interoperability is only one factor that affects seamless travel. Contactless technologies' implementation for fare payment, both long and short range, is accelerating across the transportation industry. The capabilities of contactless technologies provide opportunities to allow regional payment coordination across multiple transportation modes. These capabilities also provide an opportunity to pay for products and services beyond transportation. 1.2 Elements of Fare Payment Interoperability Fare payment interoperability does not necessarily require the use of a smartcard. Figure 1 illustrates the following high-level components to achieving interoperability: A manual system relies on human interaction such as visual inspection An automated system relies on technology--usually using fare media such as a contactless smartcard to validate interoperability This research project focused on the automated system using the contactless smartcard as the fare medium. The information and data flows required to achieve smartcard interoperability also applies to other media such as magnetic stripe tickets or radio frequency identification (RFID) tags. The physical medium used for seamless payment is a medium that carries data. The most common is magnetic stripe media; however, a solid-state, silicon-chip-based data carrier, such as the contactless smartcard, is emerging as the preferred technology. The first step in building an interoperable system is to organize the participants into a formal group. A Participation Agreement binds the participants to follow a set of common rules, also referred to as policies or business rules. At a minimum, the rules must provide the following: Technology requirements that include systems and fare media and Transaction processing that defines the data to be transferred for processing and when (how often) that occurs. These rules may also define other business-related aspects such as Branding (how the product is to be identified in the market); Customer service processes and procedures; Sharing of expenses and payment for services;