Minister Lim Hng Kiang's written reply to Parliament Questions on Cashless Card Deposit Charge

Question No 619 of Notice Paper No 106 of 2008

Name and Constituency of Member of Parliament
Mdm Cynthia Phua, Member of Parliament for Aljunied GRC

Question
To ask the Minister for Trade and Industry whether his Ministry will consider (i) helping the needy NETS card users by requiring the operators of cashless cards not to raise their charges from the current $2 refundable deposit to a $5 non-refundable fee; (ii) getting LTA to lower the $5 non-refundable charge for the ez-link card; and (iii) refunding the deposit upon expiry of these cards.

Answer
We recognize that motorists face limited choice in the payment services sector today because NETS is the sole provider of cards for making ERP payments. This is undesirable from the competition perspective. To address this, LTA is working towards adopting an open standard that will allow motorists to use cards issued by more than one card issuer. This will improve the competitiveness of the ERP payment market.

On the non-refundable deposit for the ez-link card, the Ministry of Transport has previously explained that this is based on the cost of producing the card. To lower the deposit or make it refundable will mean that every cardholder will be subsidized. This is not desirable. Instead, assistance should be provided in a more targeted way to the needy. In this regard, the Government set up a three-year $10 million Public Transport Fund last year to help lower-income commuters cope with public transportation costs. This Fund, together with additional funding from the public transport operators, has provided public transport vouchers to these commuters who are in need.

LTA is also upgrading the transit ticketing system to allow other card issuers to enter the market. This may give commuters more choice beyond the ez-link card, and potentially lower costs.