Users of city and regional buses must switch over to a new mobile application to purchase rides electronically starting in March, but cash will remain an option for riders who don’t have access to a bank account.
The Detroit Department of Transportation began using Token Transport for mobile ticketing this week and announced plans to phase out its current Passport application on Feb. 28. Riders can use the new app to purchase passes for DDOT buses that transport residents across Detroit and SMART buses that service routes across Macomb, Oakland and Wayne counties.
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Detroit City Council members said the digital option with added features – like functions for customer support and capabilities for transferring bus passes to others via email or text – is useful, but it’s important to preserve cash payments for low-income residents who are less likely to use banks. The technology shift for DDOT comes amid new proposed legislation that seeks to ban cashless retail and dining establishments in the city.
Council Member Angela Whifield-Calloway introduced the ordinance proposal this month after she was unable to buy lunch at a downtown market with paper bills. Cash-free businesses deny equal access to Detroiters, she argues.
Bus users in the city are still able to purchase 24-hour and 4-hour passes through the current app until it is phased out at the end of February. However, 31-day and 7-day passes can only be purchased through the new Token Transport application. Unused passes in a rider’s Passport wallet will be transferred to Token Transit starting March 1.
The City Council unanimously approved a $3.7 million contract with California-based Token Transit, Inc., on Feb. 14. John Wallace, agency chief financial officer for DDOT, said the new application offers a smoother experience for Detroiters.
In a press release, DDOT Executive Director of Transit Mikel Oglesby said the app is part of technology upgrades being implemented in the coming years, including electric coaches and wi-fi internet service. SMART General Manager Dwight Ferrell added that the Token Transit app will simplify purchasing passes for Detroiters and visitors and allow passengers to board buses faster.
Riders must show the pass on their smartphone to the driver when boarding a bus. The app is available on the Apple products and the Google Play store. Detroiters can get more information about how to use the new app by visiting support.tokentransit.com, texting (415) 918-6628 or calling (415) 918-6536.
Wallace said the new app is part of an effort to encourage riders who don’t carry cash to buy rides digitally, but stressed that DDOT has no plans to eliminate cash as an option.
Council Member Scott Benson said he’s missed out on a bus ride because he wasn’t carrying cash at the time.
“I’ve been there, when I’ve tried to get on a bus and had no cash and had to walk home as a direct result, so this would be a great option,” Benson said during a February council committee session. “I’m looking forward to seeing this work.”
But Whitfield-Calloway’s experience and the volume of Detroiters without bank accounts spurred her ordinance, which seeks to prohibit retailers and food service establishments from refusing to accept cash as a form of payment or charging a higher price for customers who use cash. The council’s Budget Finance and Audit Committee referred the ordinance to the Detroit Law Department last week for review.
Whitfield-Calloway has cited a 2020 report by the University of Michigan that found one in four Detroit residents are unbanked; meaning they don’t own a checking or savings account. The report found 89% of unbanked Detroiters are Black, while just 4% of unbanked Detroiters are white.
A lack of funds to start or maintain a bank account was a major reason for the lack of access, according to the study, along with high fees, bad credit scores, unemployment and racial discrimination within the banking system.
“Owning a bank account is a critical indicator of overall financial health, but with low and volatile
incomes, thousands of Detroit households opt out of mainstream banking,” the report states.
“Many residents spend to the edge of their limited incomes on basic needs, while paying bills partially or too late, and thus cannot maintain financial stability in the short term,” it adds.
Similar bans against cash-only businesses are in effect in New Jersey and Massachusetts, and other major cities like New York City, San Francisco and Philadelphia. Some cities allow residents to file a complaint against businesses that refuse cash payment, though this is not included in Detroit’s proposed law.
Cash-free businesses proliferated during the COVID-19 pandemic, when the Centers for Disease Control and Prevention released guidance encouraging retailers to use touchless payment options. Critics say shifting to a cashless society creates numerous concerns for low-income communities and undocumented residents who tend to use cash more frequently.
“During the pandemic, a lot of businesses started using just credit cards and debit cards,” Edward King, a staffer from the council’s Legislative Policy Division, said last week. “Some businesses find it more efficient to run their businesses without cash. They say it’s safer and prevents the counting of cash drawers at the end of the day. If you find an ice cream shop in the middle of Manhattan, that might work with the criteria of customer they have. However, it becomes discriminatory in places like Detroit.”
Council Member Coleman Young asked the Legislative Policy Division last week to compile a report on the number of residents who are unbanked and how many cash-free businesses are operating in the city.