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New York City transit to launch contactless payments

New York's Metropolitan Transportation Authority will soon launch the ability to tap and pay at subway terminals with contactless credit cards.

Starting May 31, customers will be able to use contactless cards from the likes of Visa Inc., Mastercard Inc. and American Express Co., and certain mobile apps to pay for transit in some places around New York City.

"Contactless payments have shaped the way consumers pay all over the world," said Dan Sanford, Visa's global head of contactless payments. Once lauded as the future of payments, the payment method has struggled to make headway in the U.S., where plastic cards supplanted cash as consumers' preferred payment method. Contactless payments are widely used in parts of Europe and Asia.

Visa and Chase announced that the 20 million Chase customers with Visa contactless credit cards will be able to use the new payment method. Visa first inked its partnership with JPMorgan Chase & Co.'s Chase Card Services Inc. in November 2018. The companies said contactless debit cards are on track to launch this summer.

New York is not the first city in the U.S. to enable contactless payments. Others including Chicago and Portland, Ore. already accept mobile payments via the likes of Apple Inc.'s Apple Pay and Alphabet Inc.'s Google Pay. But the Metropolitan Transportation Authority is the first U.S. transit agency to implement contactless payments using Visa's global transit framework. Its goal is to make contactless payments available throughout the entire subway system and on all bus routes by late 2020.

The effort is part of a public pilot rollout of a new fare system called OMNY, or One Metro New York. For now, riders will only be able to use OMNY on a full-fare, pay-per-ride basis, but the Metropolitan Transportation Authority plans to add more fare options in the future.