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In an about-face, NYC cabbies now say they love plastic

Jeremy Simon

taxi, do you take plastic?For nearly two years, news reports have chronicled New York City cab drivers’ love-hate relationship with credit cards — with an emphasis on the hate. In an abrupt shift, NYC cabbies are now confessing a change of heart toward plastic payments.

Why the warming trend? According a report by the New York Times, taxi drivers’ turnaround largely boils down to one thing: money.

Cabbies’ displayed early anger over having to take credit cards. Now, The Times writes:

“[T]wo years later, the back-of-the-cab swipe has emerged as an unlikely savior for New York’s taxi industry, even as other cities’ fleets struggle to find fares in a deep recession.”

“Overall ridership and revenue have increased. More and more fares are being paid with credit cards, even for shorter rides. And tips for drivers, usually an early casualty of tough times, are up sharply, double over the pre-plastic days.”

Back-seat card readers have apparently helped boost payments, allowing taxi riders to swipe their own plastic with no signing or minimum payments required. That customer-friendly technology also lets cardholders determine their own tip amounts.

Cabbies’ growing wallets provide one more example of what credit card industry studies show: People are stingier with real money than with its plastic stand-in. Retailers have long known about this credit card generosity — which is why they put up with the fees that go along with accepting cards. Cabbies just had to learn this lesson for themselves.

While cabbies enjoy higher earnings, taxi riders may find benefits of their own:

  • Payment for shorter trips. With no minimum requirements, riders can now put shorter rides on plastic.
  • Easier tracking of expenses. Credit card receipts show how long the ride was and where the cab went — helpful for personal record-keeping or corporate expense reports.
  • Let a machine calculate the tip. In many cabs, riders are given on-screen options for the amount of their tips — such as the choice of a $2, $3 or $4 tip on a fare under $15.

Riders — have you experienced a loving reaction from cabbies when you paid by credit card? And what have you found to be the other benefits (or disadvantages) of paying by plastic?

See related: NYC cabbies don’t want your plastic, Card-hating cabbies, you’re being watched, Credit cards: Downfall or savior of NYC cabbies?

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  • aleksandr

    this is “BS” every credit card transaction take at least 5-10 minutes and if you have passenger who never use it before you can stock for 15 minutes just waiting when transaction is going to be process and forget about tips. they are gone with winds. also CC required to pay drivers 5% of any transactions when regular fee for small businesses equal 3-3.5%. don’t forget that when you make drop off usually you are in double parking and every extra minute can cause another ticket for driver!

  • Seth

    I disagree with aleksandr and agree with this article; as a New Yorker, credit card payments for cabs have made the rides much more efficient. Often, friends will scramble with small bills, but if one swipes with a card it saves time and the others can pay him or her back later.
    Also, the process is fairly fast; it never takes more than 2 minutes to process the transaction and the cab drivers are usually thankful for the decreased hassle.

  • JT

    Having lived in NYC for 8 years I have seen the cabbies attitude toward plastic payment change over time. When first introduced more often than not the drivers would insist they did not work. Another ruse was saying they already ran the meter and it was too late to use a credit card. As cab takers have insisted upon using cards more and more the drivers have accepted it and rarely do you find them protesting anymore.

  • Eitan

    i just returned to nyc after having lived abroad for a year and there is a noticeable difference in cabbies’ attitude towards the plastic. you no longer get a grunt or a nasty look when you pull your card out to pay the fare and you still get a “thank you” when leaving the car. I can only speak for myself, but i definitely leave a more generous tip when i pay w/ plastic. as jeremy mentioned, tips based on various %’s of the fare are pre-calculated and the difference between a 15% tip and a 25% tip is usually pretty negligible so i almost always leave the maximum pre-calculated tip. psychologically, it’s also less burdensome on the wallet to pay w/ plastic than to hand over cold, hard cash so i end up paying a bigger tip for that reason as well.