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Why Are Cab Drivers Refusing Credit Card Payments?
Justin Robertson: "Toronto cab drivers are antipathetic when it comes to using their POS machines."


If someone gave me a dollar each time a cab driver in this city gave me the ‘deer in the headlights’ look when I tried to pay a fare using plastic, I’d be filthy-over-the-top rich. Over the past six months I’ve noticed Toronto cab drivers are antipathetic when it comes to using their POS (point-of-sale) machines. Even in our modern society of pocket-sized computers, their reluctancy is puzzlingly rife. For whatever reason, this summer has been the worst.

I once hailed a cab at King West and Spadina late one Saturday night, but little did I know it would lead to a wild goose chase to pay for the ride. Not because I didn’t have the appropriate method for payment, but because of the driver’s refusal to use his credit card machine that was perched on his arm rest. I will say, if I see a credit card machine inside a taxi, I’m going to assume it’s in perfect working condition. As a driver, why else would you have it sitting inside the cab? It’s certainly not acting as an air freshener device and it’s not some kind of awe-inspiring ornament that could possibly evoke conversation. It’s a portable ATM. I’m going to think I can use it to pay for the ride. Should I think otherwise?

[related articles=”56043,56034″ title=”Related Reading” position=”right”]I headed off north to home with my driver and his Bluetooth intact. The cab pulled up metres from my apartment and the fare ticked over to $17.50. I grabbed my wallet, pulled out my credit card and politely nodded toward the POS machine.

“I’ll pay by credit thanks,” I said.

“No. It’s not working,” replied the driver.

“Not working? Well, I don’t have cash,” I said.

We both sat there, kind of like an awkward date but, we’re not sure how to end it — the lean-in hug, the cold-as-ice handshake? One thing was for sure: crickets and tumbleweed were a-plenty. So, here I was with a suitable method of payment and I got rejected. Oh, the (frustrating) irony. But to the driver, this was not a suitable method of payment. He then suggested he take me to a bank to withdraw cash which led me to say, “You are joking right?” Other than leaving the cab without paying (which is against the law) I had no choice but to head to a bank. Our next mission: to find a bank. We drove for ten minutes. We hit traffic. Meanwhile the meter is running. I locate a bank and withdraw the cash. That night I ended up paying close to $30 — almost double of what I should have paid.

There have been other nights too. Sometimes it becomes comical. I’ve had cabbies tell me “sorry the machine is not working”, then I see it’s not even plugged in. Or that they say they don’t have a machine at all, but then I point out it’s hiding cleverly in the glove compartment (because I can see the curly dangly-stretchy chord hanging out the side) and when switched on, it miraculously works. Toronto taxi drivers’ and I have shared many “Eureka” moments together, but our late nights spent bonding over POS technology is slowly wearing thin.  Think I’m the only one? Here’s a forum from disgruntled taxi passengers and their dealings with cab drivers from Toronto and Ottawa.

So why is there such a fuss from cab drivers? What’s with the mockery?

Andrew Whiteley, general manager, at City Taxi Toronto said while he does encourage his fleet to install the POS machines, there are costs that could explain why cab drivers reject credit card as a payment. Whiteley said charge fees can range from 2.5 to 5 per cent per fare.

“But those costs should be nullified by gratuities and their business agreement with the taxi company,” he said.

From his fleet of 200 taxis, he said 80 per cent have the POS systems installed in working condition. Beck Taxi did not return our calls in time, so we could not compare installation numbers between two relatively big taxi companies. The Toronto Taxi Association only has 10 per cent of their fleet armed with POS machines, simply because a majority of them are independent drivers and choose to fore go the technology.

“If they have it in their car, then it should work. If it’s broken then they need to get it fixed,” Whiteley said, noting, there is no law that says if the credit card machine is in the car, they must use it. “Overall, our professional drivers have the business common sense to make sure that they can service customers — (with cash or credit).”

When cab drivers first started using credit cards as a payment option Whiteley said they did have regular complaints – from drivers and passengers – about transactions not being processed because of poor coverage and software issues, but since the introduction of the chip credit card, those issues have decreased. It could explain why cab drivers sometimes become coy when grabbing the machinery. Once bitten, twice shy? Perhaps there is a lack of confidence in using the POS system?

If you’ve taken a ride inside of New York’s iconic yellow cabs recently, ever notice it’s a bit like a digital circus in the back seat? There is stuff going on all over the place. You have numbers from the stock exchange flickering on and off and flying across the bottom of a bright TV screen, video film clips blaring and there’s a running tab equipped too with a Google mapping system. Here’s the best bit: It also lets passengers swipe credit or debit cards (how very avant-garde, right). With a high-tech fare system there’s no handing over cash (if you chose not to) to the driver. The screen also displays suggested gratuities of 15, 20 or 25 per cent. According to a study by Visa Inc. New York cab drivers are receiving a 22 per cent tip on average when credit or debit cards are used compared to 15 per cent on cash fares.

The more we become reliant on credit cards because it of its fleeting and effortless transaction process, the more we as a society need technology to keep up. And soon, Whiteley said, Toronto will most likely have the latest POS systems, (such as the ones that exist in New York) that other cities already have.

“It’s not a huge challenge to get the technology. But most of the taxi companies in the city are locked into various agreements with suppliers — it’s an investment you have to ride out,” he said. “We have to wait till that runs its course. After that, we have to see what our options are.”


Justin Robertson is a freelance journalist from Toronto. His work has appeared in The Walrus, National Post and Toronto Standard. Follow Justin on Twitter @justinjourno

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