Copyright2013,American-Eurasian Network for Scientific Information publisher

American-Eurasian Journal of Sustainable Agriculture

JOURNAL home page: http://www.aensiweb.com/aejsa.html 2014January;10(3):pages x-x.

PublishedOnline2014February30.

ResearchArticle

Cost Benefit Analysis of Single Journey Passenger in a Train Service Ticketing

System
Mainir, Rozita 1, Abdul Aziz, Faieza2, Mohd Yusuff, Rosnah3
1Departmentof Mechanical and Manufacturing Engineering, Faculty ofEngineering, University Putra Malaysia, 43400 Serdang, Selangor, Malaysia. Tel: +60126805038, Fax: +603-27113973, E-mail: ogyz88@yahoo.com
2Departmentof Mechanical and Manufacturing Engineering, Faculty ofEngineering, University Putra Malaysia, 43400 Serdang, Selangor, Malaysia. Tel: +60389466346, Fax: +603-86567122, E-mail: faieza@upm.edu.my
3 Departmentof Mechanical and Manufacturing Engineering, Faculty ofEngineering, University Putra Malaysia, 43400 Serdang, Selangor, Malaysia. Tel: +60389466342, Fax: +603-86567122, E-mail: rosnahmy@upm.edu.my

Received:April03,2013;Revised:May13,2013;Accepted: May22,2013

2013

AENSI PUBLISHER All rights reserved

ABSTRACT

In the automatic fare collection system of a train service, the providers use various methods in
handling single journey passenger. One of them is to use a ticket in the form of contactless smart
tokens. Initially, use of token system for single journey passengers seen as something that facilitates
both the operating company and its customers. However, the impact of the loss of the use of this
token cannot be anticipated at the beginning of use. Delhi Metro in its report informing loss of Rs. 6
crore in duration of 4 years due to loss of tokens (Sabha, 2012). Rapid Rail who is also facing the
similar problem in its company report also stating a loss of RM 1.38million in two years of
implementation. Who knows where went wrong when the cause of the loss of this token could not
be ascertained. To accommodate the number of passengers available, the company needs to
repurchase the token which initially expected to be sufficient. A brainstorming session had been
performed involving four engineers from Rapid Rail to identify several methods in handling single
journey passenger. An analysis is performed to identify the best method in dealing with single
journey passengers using cost benefit analysis as a decision making tool. The analysis defined that
low quality paper based system is the best method to be implemented based on the concept of the
highest benefit/cost ratio.
Keywords:Automatic Fare Collection; Contactless Smart Token; Single Journey Passenger; Cost Benefit Analysis

1.Introduction
In the automatic fare collection system of a train service,
the providers use various methods in handling single

journey passenger. One of them is to use a ticket in the

form of contactless smart tokens. Several train service
providers that are using this method is Rapid Rail, Delhi
Metro Rail and Taipei MRT. Token system for the

Corresponding Author:. Clearly indicate who will handle correspondence at all stages of refereeing and publication process. Ensure
that Name of University, Name of Department, Name of Faculty, Box.3030. City. Country. Phone numbers (with country and area
code) are provided in addition to the e-mail address and the complete postal address

M. Rozita, et al, 2014/American-Eurasian Journal of Sustainable Agriculture (X),December, Pages:x-x

company is regarded as an easy to be handled as their

light physical condition and easy to be collected for
reuse. For customers, it is easier to keep the token for a
relatively short trip and not on regular basis. However,
the impact of the loss of the use of this token cannot be
anticipated at the beginning of use. As an example at
Rapid Rail, after two years, the company began to feel
the effects of significant losses due to purchase tokens
from the supplier when the token issued to the client not
all be collected. Who knows where went wrong when
the cause of the loss of this token could not be
ascertained. To accommodate the number of passengers
available, the company needs to repurchase the token
which initially expected to be sufficient if there is no big
loss. This token loss trends month by month, showing
that the pattern of loss will remain constant. Appropriate
measures should be executed to prevent the company to
bear the cost on repurchasing the token from time to
time. An analysis is performed to identify the best
method in dealing with single journey passengers using
cost benefit analysis as a decision making tool. All of
the proposed method is assessed in detail and compared
to choose the best. The cost involved in each method is
calculated in detail and the benefits of each with single
journey passengers using cost benefit analysis as a
decision making tool. All of the proposed method is
assessed in detail and compared to choose the best. The
cost involved in each method is calculated in detail and
the benefits of each methods are quantified to gain a fair
rate comparison between the costs and the benefits. The
best method is proposed for use by the public service
provider in handling their single journey passenger.

1.1 Problem Statement

Several train service providers whom use token system
for single journey passengers are having problem of
losing token in large quantities. Delhi Metro in its report
informing loss of Rs. 6 crore in duration of 4 years due
to loss of tokens (Sabha, 2012). Rapid Rail who is also
facing the similar problem in its company report also
stating a large number of tokens are missing in the last
two years of token system implementation. A study was
conducted at Rapid Rail Sdn Bhd to identify the effects
of the use of token system towards the economic factor
within the company and its facility management after
almost two years of the implementation and the
measures for improvement.
Initially, there are 1,549,747 pieces of token distributed
to all three lines comprises of 1,395,000 adult tokens
(normal passenger) and 154,747 concession tokens
(elderly and handicapped passenger). Data gathered by
June 2013 recorded that there are only 691,049 pieces of
adult token and 90,043 pieces of concession token
remain available at all three lines. 50.4% adult tokens
and 41.8% concession tokens have been missing. Each
token is designed with magnetic memory inside with
cost price of RM 1.80. To date, all of 49.5% missing
tokens carried RM 1,383,579.00 loss of Prasaranas
investment. The incident could possibly be triggered by
internal and external factors as per described below:
i. The internal factors is any process handle by the
staff which has not been tabulate, segregate or
outlined properly.

ii. The external factor is contributed by passenger whom

the journey process was not complying with standard.
If the situation is allowed to continue, train service
providers will continue to incur significant losses in the
long run. Repurchasing of token in replace to the huge
missing amount to cater the daily single journey passenger
quantity would definitely comprising a high expenses that
reducing the companys profit. Improvement measures
should be implemented to overcome the situation.

1.2 Objectives
Two objectives of this study have been outlined that
includes the parts listed below:
i.

ii.

To determine several possible methods of

handling single journey passenger in ticketing
system.
To analyse the best method in handling single
journey passenger to be implemented by train
service providers using Cost-Benefit Analysis.

2. Literature Review
This chapter is briefly described about public
transportation history and mode offered by the providers
for use by the general public. Later to that in this chapter
will discuss on train system all over the world. After that,
the AFC system that has been implemented by train
service providers is also described. Further, it will
specifically describe about token system mechanism and
the investigation findings on missing token in Rapid Rail
Sdn. Bhd. The decision making analysis tool to be used in
this study is cost-benefit analysis (CBA).Hence, a brief
introduction about CBA will also be described in this
chapter.

2.2 Public Transportation System

Public transport is a shared passenger transport service
which is available for use by the general public as distinct
from modes such as taxicab, carpooling or hired buses
which are not shared by strangers without private
arrangement. Most public transport runs to a scheduled
timetable with the most frequent services running to
headway. Share taxi offers on-demand services in many
parts of the world and some services will wait until the
vehicle is full before it starts (Shah and Dave, 2013).There
are several modes of public transport available all around
the world as listed below.

Airline
Bus and coach
Train
Tram and light rail
Ferry
Auto rickshaws

The operation of public transportation system are

consisting of infrastructure, interchanges, timetables,
financing, fare and ticketing, and revenues, profit and
subsidies.

M. Rozita, et al, 2014/American-Eurasian Journal of Sustainable Agriculture (X),December, Pages:x-x

2.3 Train Service System

2.3.1.4 Maglev

A train is a form of rail transport consisting of a series

of vehicles propelled along a rail track to transport
cargo or passengers. Motive power is provided by a
separate locomotive or individual motors in selfpropelled multiple units. Although historically steam
propulsion dominated, the most common modern forms
are diesel and electric locomotives, the latter supplied
by overhead wires or additional rails. Other energy
sources include horses, rope or wire, gravity,
pneumatics, batteries, and gas turbines. Train tracks
usually consist of two, three or four rails, with a limited
number of monorails and maglev guide ways in the mix.

In order to achieve much faster operation over 500 km/h,

innovative Maglev technology has been researched for
years. The Shanghai Maglev Train, opened in 2003, is the
fastest commercial train service of any kind, operating at
speeds of up to 430 km/h. Maglev has not yet been used
for inter-city mass transit routes.

2.3.1 Passenger Trains

A passenger train is one which includes passengercarrying vehicles which can often be very long and fast.
It may be a self-powered multiple units or railcar, or else
a combination of one or more locomotives and one or
more unpowered trailers known as coaches, cars or
carriages. Passenger trains travel between stations or
depots at which passengers may board and disembark. In
most cases, passenger trains operate on a
fixed schedule and have superior track occupancy rights
over freight trains. Passenger trains can be divided into
three major groups:
Inter-city trains: connecting cities in the fastest
time possible, bypassing all intermediate
stations
Fast trains: calling at larger intermediate
stations between cities, serving
large urban communities
Regional trains: calling at all intermediate
stations between cities, serving all line
side communities

2.3.1.1 High-speed Rail

One notable and growing long-distance train category is
high-speed rail. Generally, high speed rail runs at speeds
above 200 km/h and often operates on dedicated track
that is surveyed and prepared to accommodate high
speeds. Japan's Shinkansen ("bullet-train") commenced
operation in 1964, and was the first successful example
of a high speed passenger rail system.

2.3.1.2 Short-distance trains

For shorter distances many cities have networks
of commuter trains, serving the city and its suburbs.
Trains are a very efficient mode of transportation to
cope with large traffic demand in a metropolis.
Compared with road transport, it carries many people
with much smaller land area and little air pollution.

2.3.1.3 Long-distance trains

Long-distance trains travel between many cities and/or
regions of a country, and sometimes cross several
countries. They often have a dining car or restaurant car
to allow passengers to have a meal during the course of
their journey.

2.4 Automatic Fare Collection System

There are only two ways to collect fares from passengers before they get onto the train or once they are on the train.
The method often adopted is to collect fares on trains but
this may not be effective for high capacity trains with short
distances between stations. In this case the simplest and
most effective method is to collect fares before trains are
boarded. This is best affected by automatic fare collection.

2.4.1 Rapid Rail Sdn. Bhd.

Integrated AFC system has been introduced officially on
November 2011 to replaced previous individual AFC
system among the three lines. The connection between
Kelana Jaya Line and Ampang Line is at Masjid Jamek
Station while the connection between Ampang Line and
Monorail Line is at Hang Tuah Station. This is to facilitate
passenger crossing any two or three lines without having
to buy the tickets more than once. There are three types of
tickets available; contactless smart card for stored value
namely MyRapid Card, contactless smart token for single
journey and Touch n Go card. MyRapid Card and token
are the actual products by Rapid Rail Sdn. Bhd while
Touch n Go card is the product of Rangkaian Segar Sdn
Bhd.
The integrated AFC system equipment consists of Ticket
Vending Machine (TVM), Automatic Gate (AG) and
Passenger Service Machine (PSM). All these equipment
are being controlled by equipment called Station
Computer System (SCS) for station level monitoring and
Central Computer System (CCS) for centralised
monitoring system located at Subang Depot. Other
supporting equipment are Initialization Machine (IM)
which is used to initialize raw card and token from
supplier and Ticket Purchasing Website (TPW) which is
yet to be launched.
Automatic Gate (AG) is equipment which forms part of
the partition between the paid area and the free area of the
station. It is able to verify a ticket at its entry. A valid
ticket will be processed, allowing access into the paid area
through the AG. Should a passenger attempt to pass
through the AG without a valid ticket, the AG will remain
closed until the passenger has cleared the entry space.
Ticket Vending Machine (TVM) is a self-service machine
for customer to purchase token for a single-journey travel
and to reload stored-value card. It has a touch screen for
selection of the destination, ticket type, and quantity and
also navigation for information. TVMs are able to accept
coins, notes or credit/debit card, give change and circulate
excess coins, and issue various types of tickets upon
selection. TVMs are installed on station concourse.
Passenger Service Machine (PSM) is providing a point of
sales for various types of ticket, which is operated by

M. Rozita, et al, 2014/American-Eurasian Journal of Sustainable Agriculture (X),December, Pages:x-x

station staff instead of being fully automatic. It has a

user friendly interface to ensure quick and efficient sale
operations to cater for high passenger volumes. It is able
to issue, revalues, revalidate, analyze and upgrade
tickets. Any invalid or problem tickets will be analyzed
at PSM. Any access fare due on invalid ticket will be
collected and properly recorded. Relevant tickets can be
upgraded to modify the code so that the tickets become
valid for entry or exit at the AG. There are 150 PSM
installed inside the customer service office (CSO) along
the three lines.

2.4.2

Bangkok Mass Transit System

Almost similar to Rapid Rail Sdn. Bhd. AFC system,

Bangkok Mass Transit System consist of Central
Computer System, Automatic Gate (AG) and Ticket
Vending Machine (TVM) but the equipment with
manned machine function is divided into two types that
is Point of Sales (POS) and Analyzer/Dispenser (A/D).
Bangkok Mass Transit System providing two types of
ticket modes for their customers:
i.
ii.

Magnetic ticket for Single Journey and Tourist

Pass
Contactless Smart Card (CSC) for Stored
Value Ticket, Period Passes and Employee
Passes

Magnetic Ticket will be slotted into ticket acceptor in

front of the gate and will be collected at the same spot
after being verified by the ticket transport module inside
the gate while CSC will be scanned by the reader on the
top of the gate.
For issuance of the tickets, single journey magnetic
ticket can be issued by two types of equipment;
analyzer/dispenser (A/D) and ticket vending machine
(TVM) while the CSC can be issued by point of sales
(POS).
i.
ii.

iii.

2.4.3

Analyzer/Dispenser (A/D): Manned machine

equipment used to issue the magnetic ticket.
Ticket Vending Machine (TVM): Selfservice ticketing machine for fast processing
and issuing of single journey ticket.
Point of Sales (POS): Supports CSC
ticketing needs (issuance of new storedvalue tickets, refund, top-up, and
replacement of missing tickets).

Singapore Mass Rapid Transit

Singapore Mass Rapid Transit (MRT) consists of three

level of equipment in the AFC system which is central
computer system, station computer system and station
equipment:
i.

ii.

Central Computer System is the AFC

management centre which is responsible for
generating reports, receiving ticketing data
from station computer, downloading system
parameter and ticket price list to station
computer.
Station computer system is primarily
provides the usage data collection,

iii.

downloading of fare related parameters to the

AFC equipment; control, monitoring and
management of the AFC equipment.
Station Equipment are all the front-end
equipment/devices, which are used to serve the
commuter. These consist of Ticket Vending
Machines, Fare Gates, Booking Office
Machines, Mobile and Hand-Held Terminals
and Ticket Recharging Machines.

There are two types of tickets available to be used by the

passengers in the form of contactless smart card for
stored-value ticket and single journey or Singapore Tourist
Pass. For stored-value tickets, the ticketing system uses
EZ-Link and NETS FlashPay cards based upon the
Symphony for e-Payment (SeP) system for public transit
built on the Singapore Standard for Contactless ePurse
Application (CEPAS) system. The card may be purchased
at Booking Office Machine and also at various kiosk. The
card may also be used for payment of goods and services.
Initially, Ticket for single journey passengers is sold
inclusive of an S$1 refundable card deposit. The card may
be only purchased at the TVM. The deposit can be
retrieved by returning the card to the TVM within 30 days
from the date of issue or donated to charity by depositing
it in a collection box at any station.
A newer generation for single journey passenger ticket is a
paper-based contactless smart card which is inquires a
cheaper refundable deposit amounting of S$0.10. The card
may be purchased at the TVM.

2.4.4

Delhi Metro Rail Corporation Ltd.

Similar to Rapid Rail Sdn. Bhd., Delhi Metro has

implemented automatic fare collection (AFC) system
using recyclable Contactless Smart Token as single
journey ticket and Contactless Smart Card for multiple
journeys (stored-value) for Delhi Metro Rail Transit
System. The equipment available at Delhi Metro is Ticket
Vending Machine (TVM), Automatic Gate (AG), and
Passenger Service Machine (PSM).
The tokens are issued from the metro stations from
manned/automatic Ticket Vending Machine. At the time
of entry, the valid token is presented by the passenger at
reader/writer of the Automatic Gate. At the time of exit,
the token is captured in the slot of the Automatic Gate.
The full token box at exit side of the gate will be swapped
with empty token boxes inside the TVM.

2.4.5

Taipei MRT

Taipei MRT uses the same approach as Delhi Metro Rail

in handling their single journey passengers. Decided to
move to an all contactless solution, Taipei MRT replaced
the existing magnetic stripe cards by contactless smart
tokens with the same recycling principle which the
implementation took place since 2007.
The token is read at the entry gate and encoded with the
entry station and price paid. At the exit gate, the traveler
inserts his token into a dedicated slot, which only opens
when a token with enough value is detected. No foreign
object is accepted. The token is then electronically
cancelled when falling down to the internal container. To

M. Rozita, et al, 2014/American-Eurasian Journal of Sustainable Agriculture (X),December, Pages:x-x

perform these functions, the card reader located in the

gate controls two antennas. One is meant to validate the
token and the one is meant to validate the stored-value
card. Once a day, that container will be removed and
carried safely to be loaded into a Token Vending
Machine.
As for the frequent MRT users, they use a stored-value
contactless smart card which also can be used in other
transport services such as buses and parking lots. The
brand name chosen for the ICcard project was EasyCard.
The launch in TRTC took place in June 2002. It started
in buses in September 2002. The EasyCard is loaded
with a value enabling its holder to travel all over the
public transport network each operator deducts the
appropriate fare to be paid from the EasyCard stored
value used by the passenger in relation with a relevant
transfer policy to encourage the use of public transport.

2.4.6

New Mexico Rail Runner Express

The New Mexico Rail Runner Express serves the

metropolitan areas of Santa Fe and Albuquerque. Unlike
most other transit systems, there are no ticket vending
machines or ticket counters. Instead, Rail Runner riders
can purchase their tickets in one of two ways: in advance
from the agencys website or directly from the trains
onboard staff using cash or credit/debit cards. Single
tickets as well as daily, monthly, and annual passes are
available through both sales channels, and all sales feed
into the same financial database. Each ticket or pass
product has a barcode that is validated by onboard
customer service agents using a handheld scanner.
The agency had the opportunity to leapfrog legacy
systems to select a fare-collection system based on more
advanced technologies, though they faced similar
challenges to implementing AFC in a system without
fare gates. Smart cards were not selected because Rail
Runner, with its very small office staff, preferred to
avoid the administrative complexity involved with
becoming a card issuer and payment system manager.

2.4.7

Hong Kong MTR

There are three different fare classes on the MTR: Adult,

Students and Concessionary. Taking any particular
station as the origin, the other stations fall into fare
"zones" depending on the distance from the origin. The
fare to all stations in a "zone" is the same and increases
with distance, especially if the journey involves a harbor
crossing. Fares for the Airport Express Line are
significantly higher. Single journey tickets and octopus
card reloads can be purchased at vending machines
while tourist passes, octopus cards and other special
tickets must be purchased at the ticket counter. Credit
cards are only accepted to purchase Airport Express
tickets.
The Octopus card is a rechargeable contactless smart
card used in an electronic payment system in Hong
Kong developed by Australian-based Company ERG
Group. It was launched in September 1997 for use on
the MTR and KCR, now operated by MTR and now is
the most widely used electronic cash system for
transactions in Hong Kong as many retailers (including
supermarkets and fast food outlets) are fitted with

readers. The technology used was Sony's Felica line of

smartcard. The Octopus card uses radio frequency
identification (RFID) technology so that users need only
hold the card in front of the reader, without taking it out of
handbags and wallets.
The magnetic fare card system is used for single journey
tickets. These tickets are pre-paid for between predetermined stations, and are good for only one trip. There
are no return tickets, except on the Airport Express. Fares
for the Airport Express are substantially different from
main line fares. Apart from single tickets, same-day return
tickets (same price as a single), and one-month return
tickets are also available.

2.5 Contactless Smart Token System

In term of the CST perspective, there are three
departments directly involved in Rapid Rail Sdn. Bhd.
namely Automatic Fare Collection (AFC) Department
whose responsible in software and hardware maintenance
of the equipment, Operations Planning Department (OPL)
whose responsible in initialising and circulating the token
between TVM, PSM and AG and Field Operations
Department (FO) whose responsible in issuing token from
the PSM and analyse token related issue by the passenger.

2.5.1

Token System Mechanism

Adult token will be bought from Ticket Vending Machine

(TVM) and concessions token will be bought from
Passenger Service Machine (PSM) as the discounted price
will be effective upon issuance of MyKad for elderly and
OKU Card for the disables.
Depending on the situation, Token will be scanned at entry
side of the automatic gate (AG) and customer will proceed
to board the train service. Once they reach the destination,
customer need to slot in the token into the exit side of the
AG. AG will verify the token and the barrier will be open.
The amount of token stored inside TVM, PSM and AG can
be monitored individually at the every equipment
component, SCS (Station Control Centre) or CCS (Central
Control Centre).

2.5.2 Missing Token Investigation

An investigation has been performed to investigate the
cause of token missing within all three lines at Rapid Rail
Sdn Bhd (Kelana Jaya Line, Ampang Line and Monorail
Line). Below points has been compiled during the
investigation.

2.5.2.1 Burden of Multitasking Staff

Due to shortage on manpower, Customer Service Assistant
(CSA) at every monorail station needs to perform the work
of OPL team. Based on the interview by Quality
Assurance personnel, there is shortage of OPL team which
lead the decision for the Monorail Lines management to
delegate the task to CSA in performing the OPLs task.
Not only recirculation the token, Monorail Lines CSA
team also help OPL in auditing the monthly token.

2.5.2.2 Unstandardized and Disorderly Facility

M. Rozita, et al, 2014/American-Eurasian Journal of Sustainable Agriculture (X),December, Pages:x-x

There are few situations where facility and environment

inside Customer Service Office was untidy and not
appropriate. Sets of Figure 3.2 show the evidence. The
task of token audit also in jeopardizes as some use
Initialization Machine (IM) and there is weighing
technique. The possibility of uneven weight among these
tokens could occur. As the technique used was doubtful,
maybe the exact token losses in lower, or higher than
what has been reported.

2.5.2.3 No Standard Reference

Based on the interview with one OPL personnel from
Kelana Jaya Line, there should be at least one procedure
from OPL to be referred by OPL staff on handling the
token. Unfortunately, the procedure only available at
Kelana Jaya Line but was not been found in practice at
Ampang Line and Monorail Line. Furthermore, it does
not been registered in company procedure as a formal
reference for all related staff.In addition to that, CSA
practices of opening all flap gates before daily closing
routine for cleaning contractors staff and any external
contract worker who has been schedule to work on the
night create some opening for token losses.

2.5.2.4 Irregularities and Inconvenience in the

New Ticketing System
While witnessing token auditing process, it was found
that the ticket monitoring system was not reliable. The
data shown on the SCS differed from the local
equipment counter. Furthermore, manual token counting
gives different value from the local equipment and SCS.
Some customers indicates that the physical size of the
token itself make it prone to drop off, missed placed or
mishandled. This claimed is supported by the detection
of token falls inside the train and around paid area.
Another one is the sensing method of the new flap gate.
There are four pieces of anti-clip sensors per flap gate
inside the monitoring zone, designed to avoid clipping
of passengers when passing through the AG. Based on
the interview sessions and observation, there are few
situation where the customer outsmart these anti-clip
sensors by tail-getting closely with the customer up
front and pass through the gate.

2.5.2.5 Customer Attitude

Probably the main contribution towards this issue is the
customer attitude. On previous ticketing system, the AG
only read the value of the ticket. However, there is an
additional feature on the new system which limits the
accessibility of this ticket. In short, there is expiration
period for this ticket after it has been bought.
All interview session with CSA staffs from the whole
three lines reported the similar situation where the
public bought extra ticket as they think that they can use
the extra ticket to be use later. Unfortunately, as the
system rejects their expired ticket, they refuse to return
it. There is also been reported by the CSA that some
customers kept the token for souvenir.
2.6 Cost Benefit Analysis as a Decision Making Tool

Cost-Benefit Analysis or sometimes referred as Benefitcost analysis is simply rational decision-making. People
use it every day, and it is older than written history. Our
natural grasp of costs and benefits is sometimes
inadequate, however, when the alternatives are complex or
the data uncertain. Then we need formal techniques to
keep our thinking clear, systematic and rational (BCA
Guide, 1998). They include a variety of methods:
i.
ii.
iii.
iv.
v.
vi.

identifying alternatives;
defining alternatives in a way that allows fair
comparison;
adjusting for occurrence of costs and benefits
at different times;
calculating dollar values for things that are not
usually expressed in dollars;
coping with uncertainty in the data; and
Summing up a complex pattern of costs and
benefits to guide decision-making.

3. Methodology
Investigation on the missing token had been executed to
strengthen the claim on the big quantity of token loss and
to find the possible root cause that contributes to the
incident. After that, brainstorming the possible solution
options had been executed and summarized into writings.
The decision making analysis tool had been identified and
analysis had been conducted based on the available
options. The tool selected in decision making is costbenefit analysis (CBA). Quantitative costs for each
prospective method were identified followed by the
quantitative benefits for each prospective method. Further
tothose, cost and benefits quantities, analysis have been
conducted to get the best decision. Sensitivity analysis had
been undertaken to test the robustness of results under
different scenarios, using different assumptions for various
variables.

3.1 Automatic Fare Collection by Service Providers

Information of AFC system practiced by public service
providers are gathered by focusing especially in terms of
the ticket medium used for stored-value ticket or single
journey passengers. Seven companies were listed with the
hope of generating ideas for improvements in management
systems for single journey passengers. The public service
providers and their single journey passenger ticket
medium are listed below:

Rapid Rail Sdn. Bhd. : Contactless smart token

Bangkok Mass Transit System: Magnetic card
Singapore Mass Rapid Transit: Contactless smart
card
Delhi Metro Rail Corporation Ltd.: Contactless
smart token
Taipei MRT: Contactless smart token
New Mexico Rail Runner Express: Bar-coded
paper
Hong Kong MTR Corporation Ltd. : Magnetic
card

Through the collection of such information, it is observed

that there are some similarities and differences in single
journey passenger ticketing management between a public
service provider and other public service providers.

M. Rozita, et al, 2014/American-Eurasian Journal of Sustainable Agriculture (X),December, Pages:x-x

Referring to upper list, three of them are using

contactless smart token, two using magnetic card, one
using contactless smart card and another one using
barcoded paper ticket. Hence, the brainstorm session
conducted was ran even faster and smoother with the
advent of this information from a variety of suppliers.

3.2 Proposal of Methods in Handling Single

Journey Passenger
A brainstorming session has been conducted involving
two engineers from the Quality Assurance Department
and an engineer from the Automatic Fare Collection
Department of Rapid Rail. The objective of the session
is to outline several methods that are possible in
handling single journey passenger by train service
providers. The outlined methods are based on the
observation, references from other public service
providers, own experiences and logical thinking to
reduce the cost on repetitive action of repurchasing
token to cater the passenger number.
By narrowing the scope of condition that might be
applied to a young AFC system such as at Rapid Rail
Sdn. Bhd., taking into account of the economic
factor,the changes that might be put into consideration
must suitable with the current condition. Since the
system is just implemented last two years, the proposed
solution should not consuming a huge cost because as a
public transport provider, the government grant need to
be justified strongly before it could be invested. Due to
the period of an AFC system to be considered as mature
enough to be wholly replaced is within 12 to 15 years
and after the consideration of software and hardware
part already obsolete, thus current system is considered
as too young.

3.3 Quantitative Costs Identification

Result of brainstorm sessions conducted, the available
solution options in handling single journey passenger by
a train service providers outlying five types of method as
explained in section 3.3 and listed below:

Deposit of RM2 upon Token Issuance

Low Quality Paper Based Ticket
Contactless Smart Card Single Journey Version
Magnetic Card for Single Journey Ticket
Mobile Ticketing Systems

Thus a process of identifying direct costs involved in

implementing each of the proposals listed options. All
the costs involved in implementing the project is
reviewed and every calculation is done based on the
estimated cost for the setup and maintenance of the same
dimensions for each option that is at market value and in
real terms which usually at the price level at the time of
analysis, allowing for any and significant changes in unit
costs over time.
The cost is expressed of each control option as a time
series of annual expenditure, reflecting the pattern of
activities over time and indicates any ongoing or
subsequent expenses. Further to that, all significant
consequences and impacts of the options considered
positive and negative, direct and indirect, tangible and

intangible across environmental, socio-cultural and

economic aspects are also identified. These effects in
terms of specific outcomes are also defined.

3.4 Quantitative Benefits Identification

From the five options of solution on handling a single
journey by a train service provider, there may be a range
of benefits to be estimated and where possible, quantified
such as:

Cost savings between options (e.g. differences in

operating and maintenance costs of equipment).
Savings in operating costs such as reduction in
labour salary primarily in operations and
maintenance are treated as benefits in CostBenefit Analysis. These may also include cost
savings for the train service provider in
operating and maintenance costs associated with
new technologies. Reductions in personnel
orientation and number of personnel could result
from a reduction in delays and these will accrue
benefits to the train service providers.
Asset disposal.
Residual values (should be included as a
negative cost item).
User benefits such as total time saving spend in
ticketing activities that could accrue due to the
simpler step from buying a ticket, ride a train
service and ticket refund process.
Improvements to the ratio of transit time to
refunding time for a ticketing operations.
Incremental net revenue from changes in costs
and charges.

3.5 Decision Criteria Calculation

The CBA procedure involves aggregating costs and
benefits across individuals without taking into account the
distribution of those costs and benefits between
individuals. Total economic worth will increase so long as
total benefits are in excess of the total costs for a project.
Economic evaluations should be based on costs and
benefits, with project options incremental to the base case.
The most effective way of evaluating a project is to
include all the absolute costs and benefits associated with
the options and then compare the options to calculate the
costs and benefits of the options incremental to the base
case.
As noted previously, all costs and benefits over the
evaluation period are discounted to a present value to
enable comparison between overall costs and benefits.
This enables the economic worth of the options to be
determined relative to the base case. At a minimum, the
net present value (NPV) is calculated and that this is the
key decision criteria as this is considered to provide a
better measure of societys wealth maximization than
internal rate of return of benefit-cost ratio. In an
unconstrained market, the option with the highest NPV
provides the best economic return.

M. Rozita, et al, 2014/American-Eurasian Journal of Sustainable Agriculture (X),December, Pages:x-x

4.1.5 Mobile Ticketing Systems

4. Results and Discussion

This section discusses about the several possible
methods of handling single journey passenger by a train
service provider as listed below:

Deposit of RM2 upon Token Issuance

Low Quality Paper Based Ticket
Contactless Smart Card Single Journey Version
Magnetic Card for Single Journey Ticket
Mobile Ticketing Systems

The methods listed are gained from the brainstorming

session performed in Rapid Rail Sdn Bhd with the
representatives from Quality Assurance Department and
Automatic Fare Collection Department. Further to that,
direct costs quantification and benefits quantifications of
the five options in handling single journey passenger by
a train service provider are determined. All costs and
benefits over the evaluation period are discounted to a
net present value (NPV) to enable comparison between
overall costs and benefits. This is included in the
decision criteria calculation section. After that, the
sensitivity analysis is performed to test the robustness of
the results. Later, the preferred option is identified.

4.1

Total Development Cost

Total Operational cost
Total Non-Recurring Cost
Total Recurring Costs
overall cost

4.2

31,489,000.00
20,028,596.58
15,838,000.00
26,223,300.00
93, 578,896.58

Quantitative Benefits Analysis

This section is showing all the benefit calculation to

develop and operate each alternative listed previously,
including both one-time and recurring costs.

4.2.1 Deposit of RM2 upon Token Issuance

Total Non-Recurring Benefits
Total Recurring Benefits
overall benefits

2,805,744.60
50,000.00
2,855,744.60

Non-quantifiable benefits (Benefits that cannot be

quantified in terms of direct dollar values)
- Improve service efficiency due to avoidance of token
shortage

Quantitative Costs Analysis

4.2.2 Low Quality Paper Based Ticket

This section is showing all the cost calculation to

develop and operate each alternative listed previously,
including both one-time and recurring costs.

Total Non-Recurring Benefits

Total Recurring Benefits
overall benefits

22,234,065.10
2,514,500.00
24,748,565.10

4.1.1 Deposit of RM2 upon Token Issuance

Total Development Cost
Total Operational cost
Total Non-Recurring Cost
Total Recurring Costs
Overall cost

29,060,000.00
36,826,941.18
15,838,000.00
20,859,300.00
102, 584, 241.18

4.1.2 Low Quality Paper Based Ticket

Total Development Cost
Total Operational cost
Total Non-Recurring Cost
Total Recurring Costs
Overall cost

23,439,000.00
24,824,002.08
15,838,000.00
18,669,300.00
82, 770, 302.08

4.1.3 Contactless Smart Card Single Journey

Version
Total Development Cost
Total Operational cost
Total Non-Recurring Cost
Total Recurring Costs
Overall cost

28,595,000.00
27,636,141.18
15,838,000.00
18,969,300.00
91, 038, 441.18

4.1.4 Magnetic Card for Single Journey Ticket

Total Development Cost
Total Operational cost
Total Non-Recurring Cost
Total Recurring Costs
Overall cost

29,010,000.00
39,520,217.08
15,838,000.00
20,733,300.00
105, 101, 517.08

Non-quantifiable benefits (Benefits that cannot be

quantified in terms of direct dollar values)
- Improve service efficiency due to avoidance of token
faulty occurrences
- Improve equipment operational hours due to token
boxes swapping between automatic gates and ticket
vending machines are no longer executed
- Enhance organizational image due to non-occurrences
of ticket vending machine in out of service mode due to
finished token supply (while waiting for token
replenishment activity)
4.2.3 Contactless Smart Card Single Journey Version
Total Non-Recurring Benefits
Total Recurring Benefits
overall benefits

18,645,985.00
2,514,500.00
21,160,485.00

Non-quantifiable benefits (Benefits that cannot be

quantified in terms of direct dollar values)
- Improve service efficiency due to avoidance of token
faulty occurrences
- Improve equipment operational hours due to token
boxes swapping between automatic gates and ticket
vending machines are no longer executed
- Facilitates staff and customer on understanding of
ticketing media due to usage of only one type of ticket
for both stored-value and single journey
- Enhance organizational image due to non-occurrences
of ticket vending machine in out of service mode due to
finished token supply (while waiting for token
replenishment activity)

M. Rozita, et al, 2014/American-Eurasian Journal of Sustainable Agriculture (X),December, Pages:x-x

4.2.4 Magnetic Card for Single Journey Ticket

Total Non-Recurring Benefits
Total Recurring Benefits
overall benefits

464,924.10
464,924.10

4.2.5 Mobile Ticketing Systems

Total Non-Recurring Benefits
Total Recurring Benefits
overall benefits

4.3 Present Value Cost

In many cases, the timing of costs is an important aspect
of the project under consideration. For this reason,
dealing adequately with the timing of the cost becomes a
crucial part of the cost-benefit analysis. Discounting is a
technique that converts all costs into their value in the
present
Whenever the costs used in a cost-benefit analysis occur
in the future, it is important to discount these future
values to account for their present value. The following
formula is used to find the cost present value (P) of a
cost amount (F) spent at some time (n) in the future with
an assumed cost interest rate (i):
F
(1+i)n

Based on the above formula, the present value of the

subtotal costs listed in are calculated using interest rates
of 1% as following:

Alternative
Deposit of RM2 upon
token issuance system
Low quality paper based
ticket system
Contactless smart card
single journey version
system
Magnetic card for single
journey ticket system
Mobile ticketing system

Accounting for the time value of money would require

defining the benefit/cost ratio as the present value. The
benefit/cost ratio (BCR) is calculated as the net present
value (NPV) of benefits divided by the NPV of costs as
per showed in below formula:

22,675,844.60
334,500.00
23,010,344.60

Non-quantifiable benefits (Benefits that cannot be

quantified in terms of direct dollar values)
- Improve service efficiency due to avoidance of token
faulty occurrences
- Improve equipment operational hours due to token
boxes swapping between automatic gates and ticket
vending machines are no longer executed
- Enhance organizational image due to non-occurrences
of ticket vending machine in out of service mode due to
finished token supply (while waiting for token
replenishment activity)

P=

4.4 Benefit/Cost Ratio

NPV Cost
(RM)

NPV
Benefit
(RM)

373,832,384

3,505,930

325,540,335

57,446,376

362,286,584

53,858,296

374,711,193

464,924

434,578,903

27,360,083

Where Bn is the Benefit in time n, Cn is the cost in time,i is

the interest rate and n is an index running from 0 to N
representing the year under consideration. In general, the
larger the ratio, the better the alternative. Based on the
above formula, below table is showing the BCR of the
alternative options:
Alternative
Deposit of RM2 upon token
issuance system
Low quality paper based ticket
system
Contactless smart card single
journey version system
Magnetic card for single journey
ticket system
Mobile ticketing system

BCR
0.00937835
0.1764647
0.14866213
0.00124075
0.06295769

Above table shows the highest BCR is gathered from the

second option alternative that is low quality paper based
ticket system with BCR of 0.1764647

4.5 Sensitivity Analysis

The main goal of sensitivity analysis is to gain insight into
which assumptions are critical, that is which assumptions
affect choice. The process involves various ways of
changing input values ofthe model to see the effect on the
output value. In this project, the sensitivity analysis is
performed to measure how much the cost of the
alternatives will fluctuate as a result of changes in the
interest rate environment. Alternatives that are more
sensitive will have greater cost fluctuations than those
with less sensitivity. Generally, the longer the maturity of
the asset, the more sensitive the asset will be to changes in
interest rates.
For the purpose of this sensitivity analysis, the manual
what-if analysis is performed by increasing the discount
rate (interest rate) of the present value cost and benefit.
Each what-if analysis is calculating the benefit/cost ratio
(BCR) when the interest rate is increased by 1%. Below
table is showing the BCR when interest rate is increased to
2%.

M. Rozita, et al, 2014/American-Eurasian Journal of Sustainable Agriculture (X),December, Pages:x-x

Alternative
Deposit of RM2
upon token
issuance system
Low quality
paper based ticket
system
Contactless
smart card single
journey version
system
Magnetic card
for single journey
ticket system
Mobile ticketing
system

NPV Cost
(RM)

NPV
Benefit
(RM)

BCR

355,112,116

3,461,057

0.00974638

308,785,492

55,189,728

0.17873161

343,566,316

51,601,648

0.15019414

356,104,005

464,924

0.00130559

411,044,690

27,059,885

0.06583198

When an interest rate is increased by 1% from the initial

rate of 1%, the BCR of second alternative which is low
quality paper-based ticket system is still the highest with
the value of 0.17873161.
This analysis is further executed to measure the
sensitivity level of the best option towards the changes
in interest rate. The manual what-if analysis is continued
by increasing the interest rate to another 1%. Below
table is showing the total present cost and total present
benefit of all the alternative options when the interest
rate is increased to 3%.
Alternative
Deposit of RM2
upon token
issuance system
Low quality
paper based ticket
system
Contactless
smart card single
journey version
system
Magnetic card
for single journey
ticket system
Mobile ticketing
system

NPV Cost
(RM)

NPV
Benefit
(RM)

BCR

338,212,420

3,420,548

0.01011361

293,660,080

53,152,541

0.18100023

326,666,620

49,564,461

0.15172796

339,306,390

464,924

0.00137022

389,799,211

26,788,881

0.06872482

When an interest rate is increased by 1% from the first

manual what-if analysis rate of 2%, the BCR of second
alternative which is low quality paper-based ticket
system is still the highest with the value of 0.18100023.
The manual what-if analysis is continued by increasing
the interest rate to a greater amount of 10%. Below table
is showing the total present cost and total present benefit
of all the alternative options.
When an interest rate is increased by a greater value to
10% from the second manual what-if analysis rate of
3%, the BCR of second alternative which is low quality
paper-based ticket system is still the highest with the
value of 0.19642245.

Alternative
Deposit of RM2
upon token
issuance system
Low quality
paper based ticket
system
Contactless
smart card single
journey version
system
Magnetic card
for single journey
ticket system
Mobile ticketing
system

NPV Cost
(RM)

NPV
Benefit
(RM)

256,248,185

3,224,079

0.01258186

220,301,200

43,272,101

0.19642245

244,702,385

39,684,021

0.16217259

257,837,258

464,924

0.00180317

286,757,752

25,474,502

0.08883631

BCR

4.6 Discussion
The itemised quantitative cost and itemised quantitative
benefit were performed considering the recurring and nonrecurring amount. Somehow the benefits of the options
also consists the non-quantifiable benefits that was listed
to be an added value to the best option that is gained from
the calculation method. The estimated lifetime of the
system is 15 years considering the obsolete of software
and hardware system in the industry as well as the average
value gathered worldwide on an automatic fare collection
system.
Each costs and benefits is calculated within the method of
present value identification to define the time value of
money because money has interest-earning potential. The
benefit/cost ratio (BCR) is performed by dividing the total
present value of benefits over the total present value of
costs. The highest ratio among all the alternatives is the
best ratio which in this stage the low quality paper based
ticket system is showed as the best method.
Sensitivity analysis using a manual what-if analysis is
performed to gain insight into which assumptions affect
choice. The benefit/cost ratio (BCR) of the alternatives
does not affected by the changes of interest rate. Any
amount of interest rate would still make the low quality
paper-based ticket system as the best proposal proven by
its highest BCR criteria.

5. Conclusion
There are various types of ticketing medium used by train
service providers. One of the medium is contactless smart
token system. But the implementation of contactless smart
token system in handling single journey passengers is
found to be problematic due to the large number of
missing token that is supposed to be recycled. As for
example, Delhi Metro in their report stated that they has
loss Rs 6 Crore in last four years of contactless smart
token implementation while Rapid Rail Sdn Bhd has loss
RM 1.38 million in last two years of implementation. An
improvement measure to overcome the situation has been
outlined by using cost-benefit analysis.
Five possible options of handling single journey passenger
have been collected from a brainstorming session. Further
to that, the itemized quantification of costs and benefits
contribute by each options were identified. Life cycle of

M. Rozita, et al, 2014/American-Eurasian Journal of Sustainable Agriculture (X),December, Pages:x-x

the system is estimated to be 15 years. Overall cost and

benefits over the life cycle has been put into
consideration. The present value of the cost and benefits
of each option were calculated to define the time value
of money.Benefit/cost ratio (BCR) method was used in
determining the best option. Generally, an option with
the highest BCR compared to the others is considered as
the best option. Based on the benefit/cost ratio (BCR)
performed with the 1% interest rate, low qualitypaperbased ticket system was analysed to have the highest
rate followed by contactless smart card single journey
version system, mobile ticketing system, deposit of RM2
upon token issuance system and magnetic card for single
journey version system.

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Low quality paper-based ticket system is showing the
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