Bidding for new Philipines Automated Fare Collection System Concession started

The acting secretary of the DOTr is quoted as saying that the new Philippine AFCS must be "interoperable and interconnected". Unfortunately, these words could mean everything or nothing. The national standard (3) is not much help either. But this is the topic for another post.

Some questions come to mind straight away.

Does interoperability mean that any ticketing or payment solution that works with one operator or within one mode of transport must work with all other operators or modes of transport? Or will there be one ticketing option that works everywhere while all others are optional?

Does interoperability mean that there must be no proprietary technology, standard or specification that would make it impossible for any company to join the system without getting permission from any of the existing players?

Will the interoperable AFCS permit travel across multiple operators or modes of transport with one ticket or payment instrument?

Which interfaces within the system will be standardized and which ones are left to competition between multiple suppliers and vendors? For instance, should there be a standard that defines the protocols and data standards between automated gates and the next level in the hierarchy, making it be possible to simply drop in automated gates from a different supplier?

Interoperability is a tricky subject, especially since the system is supposed to support many forms of electronic payment. In my view, the quest for perfection is the enemy of good. There should only be one or two ticketing options that must be implemented by everybody and that works the same way everywhere. This option should have its own name and acceptance mark to create a sense of a standardized system for the passengers.

Nobody needs to implement any of the other options, but if they do, they have to follow the standard. This means no operator is allowed to come up with their own proprietary fare collection solution. For instance, if an operator accepts GCash QR tickets, then it must accept the same QR code tickets as everybody else.

Furthermore, only two interfaces should be standardized: (1) the interface between fare media and validators and (2) the interface between AFCS provider and the inter-provider settlement systems (tier 4 or 5).

There are two more general functions that need to be standardized. One is the Registrar who makes sure that all identifiers in the system are unique and have the same meaning. Another area for standardization one is the operating rules and dispute resolution.

The alternative would be to implement all ticketing and payment option on every tier 1 device - validators automated gates and so forth. Instead of one QR ticket standard, there would be a GCash QR ticketing standard and another one from PayMaya and so forth. The same would happen with different types of payment cards or the traditional offline stored-value cards.

The media reports that the new Philippines AFCS will be used in "major rail lines", including the light rail systems of Manila and the planned Subway. It is unclear whether major rail lines also include the North-South Commuter Railway.

The ADB contract (1) gives the impression that the PAFCS would apply to every mode of transport including buses, modern Jeepneys and UB Express vans.

I have my doubts whether this is a realistic approach. You can read my thoughts on it in previous posts here and here.

The new PAFCS is supposed to support pretty much all forms of electronic payment, "including credit cards, debit cards and eWallets", plus other digital payment platforms that are not defined. As said before, asking for everything risks getting nothing.

With too many options, there will be implementations where some options are not available or do not work reliably. That means, passengers cannot be sure that the one ticketing or payment option they have chosen will actually work everywhere along their journey. The result is that passengers have to bring multiple ticketing and payment options hoping that one will work with the mode of transport they have chosen. This would not meet even the weakest definition of an interoperable system.

According to the ADB contract the concessionaire will be responsible for the “development, operations and maintenance of the automatic fare collection system for all transport modes in the Philippines” (see (1)).

I find it hard to believe that one single company would operate the entire AFCS across all provinces, all modes of transport and all transport operators. Instead, I would expect that the concessionaire operates like a payment scheme which ensures interoperability and leaves plenty of room for competition between AFCS providers.

Since the current concession has already expired last year and is probably running on an extension, there is some pressure to get a new concessionaire in within 2026. Even if a new concessionaire is chosen by the end of 2026, they will neet at least one to two years to take over the existing system and implement whatever they have agreed to in the concession agreement.

I hope that the bid document will be published and that "publish" actually means freely available on the internet for everybody to download and read. This would demonstrate openness and transparency right from the start.

A publicly available bid document also gives interested parties an opportunity to comment and to verify whether the concession agreement actually meets the requirements outlined in the bidding process. The same would apply later to the concession agreement. I don’t see any good reason why the documents should not be available to the public.