Making bus fares fairer in India
In 2015, the Bangalore Metropolitan Transportation Corporation (BMTC) approached WRI Ross Center to help it find a way to restructure fares equitably. Its existing fare table, which relied on an outdated zone system, was cumbersome and confusing. Depending on the route, one trip could cost twice as much as another of comparable distance. Riders without exact change were frustrated by long payment transactions, and bus conductors would often round fares down, resulting in losses for the corporation.
“Paying for my ticket was difficult because the costs were so random,” explained BMTC passenger Aloke Mukherjee. “Fares weren’t rounded off to convenient amounts, so making change was a huge problem. I would end up paying extra at times, especially in crowded buses.” BMTC bus conductor Mr. Somashekar agreed. “I couldn’t make change easily. I needed to carry a lot of coins and often found it very difficult to hand them out. Customers would often get angry and haggle with me to reduce the cost of the ticket.”
To ease commuter woes and capture the correct revenue, BMTC ticket pricing needed an overhaul. WRI Ross Center and FedEx supported a two-year restructuring process that included deploying 28,000 User Satisfaction Surveys, reviewing policies for fare-setting and payment, suggesting ways to correct irregularities and increase revenues, and setting the stage for public buy-in.
The new fare structure, adopted in April 2017, is a win for customers as well as the BMTC: a simpler, more equitable payment system that also avoids operational losses for the corporation. It sets fares according to the distance traveled, eliminates extra penalties for transfers, and in a major change, charges less for shorter rides on heavily traveled corridors.
For passenger Mukherjee, that means a cheaper commute. “The cost has come down greatly,” he says. “I travel approximately 8 kilometers, and I pay 2 rupees less now than I did before. And I don’t need to haggle with the conductor for my change.”
Now, other regional transportation companies have asked WRI Ross Center for guidance on fare rationalization and restructuring. Pawan Mulukutla, head of Integrated Transport at WRI India, said his team will build on their experience in Bangalore and scale it up for a new project with the North West Karnataka Road Transport Corporation. “We’ll amplify the approach we crafted for BMTC and apply it to a larger target, moving from service within a city to services that connect cities,” he said. It’s an example of how FedEx and WRI Ross Center’s solutions are being expanded to improve transportation for millions.