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Ever Try To Use Credit In A Boston Cab?

It's been a year and a half since the city of Boston mandated that all of its cabs install credit card machines in the back seats. But that doesn't necessarily mean using them is so simple. (amador_emmanuel34/Flickr)

BOSTON — It’s a frigid cold Sunday night and a group of young people are huddled together outside a bar, shivering. All they want is a cab. Well, that’s not entirely true. They also want to pay with credit. But none of them are particularly hopeful.

“A lot of times they’ll say they take credit cards and then the machine’s broken,” one man says.

“I’ve been in a cab and tried to ask them to drop me off at an ATM machine so I can get cash because I don’t want to go through the s*** of trying to use my debit card,” a woman says. “It kind of sucks.”

It has been about a year and a half now since the city of Boston mandated that all 1,825 of its cabs have credit card machines installed in the back seats — and that drivers must accept those cards when the passenger asks. But all you have to do is bring it up and everyone seems to have a story of what happened last time they or one of their friends tried.

Policing The System

The folks at the Boston Police Department have heard it all. Especially Mark Cohen, the director of licensing for the Hackney Division.

“We probably are receiving at least five or 10 complaints a day on a bad day,” he told us when we visited him at police headquarters, to see how his team is handling regulation of the system.

There isn’t actually much to see, though, in Hackney, where most of the policing is being done digitally. The complaints usually come in by e-mail. Cohen had received this one the day we visited:

When we were asked to pay, I took out my credit card, but was told there was a minimum of $10 in order to use it. This had not been mentioned at the beginning of the ride. I became more skeptical of the driver’s claim when the credit card began to process and asked me for a tip amount. He hastily reached into the back and pushed cancel. I don’t know his intention, but this isn’t the first time this has occurred.

Of course, there is no minimum dollar amount for a credit card transaction on a cab ride.

So the next move is for an officer to call the driver of the cab in for a hearing, to get his side of the story. But given that all these transactions leave digital footprints, it’s pretty easy for the police to figure out who is telling the truth.

“Nobody keeps records like banks,” Cohen jokes.

“The credit card machines are absolutely the best thing that’s ever happened to the cab industry.”
– John Ford,
owner, Top Cab and City Cab

If it turns out the driver was the problem, the police slap him with a three-day suspension. It is in Hackney’s interest to take these claims seriously — a year and a half into the program, Cohen estimates one-third of all cab transactions are already by credit.

And he is convinced that many of those transactions are customers who would not otherwise have taken a cab, because a few months after the machines went in, he said, cab ridership in Boston went up for the first time since Sept. 11.

That’s why the cab companies like the new rules, too. John Ford, the owner of Top Cab and City Cab, two of the seven accredited taxi companies in Boston, said his business is up 15 percent since the machines became mandatory.

“From my end of the business, which is the boss, I think the credit card machines are absolutely the best thing that’s ever happened to the cab industry,” he said.

So Ford has no tolerance for resistant drivers. In fact, he doesn’t hesitate to hand them over to Hackney. “If the same guy is continuously doing this to customers, we will turn him in,” he said. “Because it hurts everybody. He hurts my business by doing that; he pisses off my customers.”

The View From The Front Seat

If the cab companies love the new regulations, and the police department loves them and it is meaning more business for everyone — what exactly is it that is motivating these drivers who give you a hard time when you try to swipe?

We recently hailed a cab outside our studios on Commonwealth Avenue and met Tony Mwokeji, a driver for Independent Taxi Operators Association, and asked him if the credit card machines are costing him money.

“Oh yeah, big time,” he said without pause.

Mwokeji lists two major reasons: the 6 percent fee he’s charged on all credit card transactions and the fact that he has to wait 24 hours for the transactions to go through, meaning he’s shorter on cash.

“Sometimes I don’t have cash to buy lunch because everybody uses credit card,” he said.

“Sometimes I don’t have cash to buy lunch because everybody uses credit card.”
– Tony Mwokeji,
Boston cab driver

But it was the 6 percent fee that was easily the biggest complaint we heard from drivers. The payment system is set up between the cab companies and the two credit card processors who run those services for all Boston taxis, Creative Mobile Technologies and VeriFone.

The drivers have no control — which makes Mwokeji furious. “They make you take the bank that you don’t want to deal with,” he said. “I don’t like Bank of America. I have my own bank.”

Then there are the technical issues. The same morning we got in Mwokeji’s cab, he’d had trouble getting his credit card machine to work after taking a customer from Logan Airport to Newton. The customer didn’t have the $68 in cash, so Mwokeji had taken down the man’s credit card number by hand on a piece of paper, along with his cell phone number in case of any issues.

“I don’t know whether anybody will cash this for me,” Mwokeji said, holding up the slip of paper. “Sixty-eight dollars, that’s risky business.”

And this was one of the good customers. Mwokeji says there have been many cases where the machine goes down and a customer just flat out refuses to pay. Often, he says, they think he’s lying because drivers have earned that reputation. But there is nothing he can do about it.

“It’s lost money,” he said. “I have [a] wife and four kids and my mortgage to pay. And every day I come out, I have to take risks like that. It doesn’t make sense.”

‘Change Doesn’t Come Easy’

Back at the police department, Cohen would dispute a few of these claims.

He says finding out whether a machine was working or not is as simple as checking the records. As for the 6 percent, “the requirement for every taxi to have this kind of equipment was paid for by the last rate increase,” he says. “We built in a percentage of rate increase to cover that 6 percent.”

And, while Cohen doesn’t love to say it, he admits that an undeniable part of all this revolves around the nature of the cab industry itself.

Ford, of Top Cab and City Cab, is more blunt.

“Change doesn’t come easy, especially in this industry,” he said. “These guys don’t like change at all and it’s tough to get them into new ways of thinking.”

Most of the drivers, Ford says, have already come around. There are more than 6,000 cab drivers in the city and the majority will accept your credit card without a word. But that small group of stubborn holdouts are the ones you are always hearing about.

But Ford thinks they are part of an era that has now almost past.

“I’ve been in the business since I was 17 and it’s almost 44 years,” he said. “I have seen this industry from shaggy, shifty, sleazy to where it’s pretty much all spit and polish right now, and high tech. So I’ve been the whole gamut of this industry and right now it’s the best it’s ever been.”

And, in the end, taxis are a service industry, which means the customer is king. Just keep in mind, if the driver says the machine is not working, there is a chance he’s telling you the truth.

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  • Newtoncab

    Hi thanks for the interesting subject am myself cab owner in the suburb and had experienced high credit card fees but I found an alternative and it’s called square it’s a product from tweeter am not doing any advertising for them but it’s 2.75 percent that they charge but you have to an iPhone or a droid thanks and just for a record no all cabs are liars.

  • course11

    I’ve twice had cabbies complain about me using a credit card to pay — both of them saying they don’t get paid for 3-4 days for cc transactions. It’s frustrating to feel like I am being blamed for a setup that I have nothing to do with.

    As for the cab driver Mwokeji in the article, when he says he has no money for lunch… isn’t this mostly a problem of cash flow planning? He gets paid eventually, just not right then and there.

    Finally, as for the rate hike taking the 6% fees into account, I wonder if this reasoning was shared explicitly with cab drivers when the rate went into effect? If it was not, no wonder they’re upset – it feels like money stolen from them.

  • Maya9

    It seems like if they’re upset about not getting paid right then and there, then they are complaining about something that most people have to deal with every day. I certainly don’t get handed cash at the end of my work day. I get paid at the end of the week, like almost everyone else I know. If you need cash for lunch, it shouldn’t be that difficult to keep some money in your bank account and go to the ATM.

    • radbn

      This is just what I was thinking. I have to wait until the end of the week to get paid . some bi-weekly.  Money is money and when you do it, it will STILL be money.   I hate that they take it out on the customer/passenger. If this is a new rule you don’t like in the cabby industry then get out. It makes no sense to get angry for having to wait for money like the rest of the people in the world and then still get mad because you dont know how to budget your money properly so it last long enough untill the next payment?

      • Adam A

        Yeah but at the end of every shift you work, you don’t pay your company for the lease of the taxi which can be from $90 – $110 and you don’t have to pay other expenses like gas and tolls. It is for you to complain about taxi drivers when in fact you never drove a cab and you don’t know what cab driver goes through every day from all the terrible treatment from cops, from companies they work for and from the passengers.

  • Stealth

    6% sounds quite high for processing an electronic transaction, especially when the credit card cartels prevent businesses from setting minimums or allowing discounts for using cash.

    • Anonymous

      Thanks to the Obama credit card reform, credit companies can no longer stop merchants from setting minimums or cash discounts.

  • Cambridgian

    Was this mandated in Cambridge as well? I take cabs fairly often between my home and office (both in Cambridge) and could count on one hand the number of times I have been able to pay with a card (and in those times, the driver was extremely irritated at me). Then again, I can’t remember the last time I got in a cab in Cambridge and the driver even knew where he was going, so I guess the bar is just lower on our side of the river.

    Good for the BPD for actually investigating complaints. I have had some truly hellacious experiences trying to get cabs late at night in downtown Boston (being passed over for not having cash, being passed over simply because the driver didn’t want to deal with a young person he assumed to be drunk) and it really does make you feel powerless. Worst customer service of any industry I’ve experienced, and that’s saying something coming from a Comcast customer.

    • Lisa Tobin

      Cambridgian,

      No, the credit card machines are not mandated in your city. Individual cabs may choose to install them, but the city of Cambridge doesn’t require it.

  • Terralin

    well I believe that credit cards scam the vendor, always have…. if we actually paid in cash not just cabs but all local transactions (grocery, pharmacy, whatever…) I bet we would all be in much better financial shape – cab drivers in my opinion should NOT have to deal with credit cards — what happens if said card was stolen? and then reported? does the cab driver get dinged? that is what happens to a store owner if they accepted payment via credit card that then gets reported stolen – the charge is reversed back to them

  • Pierce

    As I recall the rates were raised due to high gas prices, then gas prices dropped, and have not returned quite to the level they once were, yet the higher rates remain in effect. Perhaps a reporter could find and analyze some of those numbers, and see just how much that has added up to. I have had enough run ins with rude Boston cabbies to drain me of nearly any sympathy. 90% of society has a lag of 2 weeks or more between the hours they work and their compensation, I for one am untroubled by a cab driver having to wait 24 hours.

  • Matt

    I have had several cab rides in the last year where the driver refused to allow me to use my credit card or the driver began rude when I asked to pay by credit. Being a frequent traveler, Boston is the only city I ever experienced trouble paying for a cab ride with a credit card. Anytime, I am in Boston and require a cab, I make sure to have cash.

  • V.A.

    I think there are some extremely serious issues with Boston cabs, and the credit card debate is only part of it. I cannot tell you how many times a cab has locked their doors on me and driven off refusing to take me to where I wanted to go after a night out. Or, jacked up the fare by going the “long way.” there are some great cab drivers that are a pleasure to ride with, but definitely many that are not.

    The industry needs closer watch in my humble opinion.

  • Nuacara

    If there were a simple way to alert customers when a credit card machine is legitimately on the fritz, I would be all for it. But it would have to be something hardwired to the machine, not a signal from the driver himself. I have too often heard “the machine don’t work” as the excuse for failure to accept credit. If I knew that such claims were legit, I would accept that it is my job to find a cab that can take my form of payment, just like I have to find the right lane at the grocery store. I also find it interesting to hear that drivers have to wait 24 hours for payment – drivers have consistently told me that they wait 3 or 4 days. Is that because the cab companies are slow in paying them, or they are slow to get physically to the company for payment?

  • Labpps

    Are they in business or not?

  • Jeff

    Install ATM machines inside cabs. Problem solved.

  • http://ouramericainitiative.com Ben

    This is a case where scarcity and high prices are government-induced… *real competition* would solve most of the problems covered on the show.

    The legislature should regulate cabs statewide and abolish the local medallion systems — the medallion systems serve the interests of owners, not customers. You think it’s bad in Boston? Try getting a cab in towns like Fall River (here the problem is lack of supply and service more than high prices).

    Lack of cheap and reliable cab service in many areas is just one more reason why people feel that they absolutely must own a car. The current system is inefficient and needs a complete A-Z overhaul.

  • Derbala444

    My name is emad derbala I am vice president in broad is Boston taxi owner association we have file many lawsuit against city of Boston some still pending in court some of the issue is for example you have interview John ford yesterday he didn’t mention that he is part owner with verifone credit which is one of two credit card provider in Boston taxi also about the cost of cab after Boston police have lost the hybrid case that we file against them they come up with same rate for all cab rent so they are the one who set the rate also what they did they eliminate that lease because regular driver can’t effort paying 30,000 for car and there always double standar for example to open radio association in Boston you have to b in Boston that not the case with city cab and top cab they actualy in revere another one after the require to buy new cab big fleet owner was allowed to but use car everything we say we have proof ofthat why we always in court with city of Boston if you would like to hear they other side of the story please give me call at 781-417-9537

    • J.F. Fan

      john ford wishs he was so smart to have been part of such big scam called Verifone. He is old news.

    • http://www.thetransactiongroup.net/smart-phone-iphone-credit-card-processing/ Mobile credit card processing

      One suggestion could be to take a credit card through your smart phone or iphone. Fees are much less than 6%. Contact me if you need more information. Our credit card processing fees are much less than 6% but I am not sure if you can get out of your contract.

  • Town Taxi Lives on!

    The meter rate increase was forced in place at the time the gas cost had rocketed to $4.20 per gallon. It came almost 5 years after the pervious rate increase. After the rate increase: Credit card mandate shoved down drivers throat in matter of couple months (6% burden+ verifones illegal fees to access own money + All uncollected downtimes due to verifone horrible system/installation$$$$$), New vehicle mandate (300% increase in vehicle purchase), increase cost of association dues (4 cab companies anounced higher rate when John Ford friends diaccredited my association, Town Taxi, 20%). Not to mention anymore, Mr. Cohen thinks we are all morans by saying that all this crap was built in to a meter increase. So what the hell the driver behind the wheel got; add the percentages and they got shit. They got forced to pay for hybrid junk at Boston Cab , upward of $110 per 12 shifts. They got forced to low grade radio associations such as Top Cab & City cab who gives shit for the money John Ford collects for kissing butts. Boston Taxicab industry has become a circus of speculators and a circle of friends in fraud.

  • 617-TaxiCab 617-829-4222

    Since the new ruling came down from hackney to put in the credit cards, 2 companies have emerged as the providers in all 1825 cabs in Boston. CMT and Verifone are on every taxi in Boston trying to process passenger credit cards. 617-Taxicab has both of the credit card systems in their cabs. As you know, technology is great when it works. In order to have efficiency with the new technology, the credit card systems have been tied to the meter. On some occasions, ( and I am not talking all the time) the credit card systems go down and if the CC does not work , the meter, in most cases will not turn on. By rules a driver is not allowed to work on a cab that does not have a working meter and need to repair the system as soon as possible. If there is an issue with a credit card we can be called at 617-829-4222 to remedy the situation. Unfortunately there are some bad seeds in every industry, and we have to combat that.

  • Bostontaxivoice

    Boston’s cabs are not the most expensive. Check the prices for Newton, Brookline and Cambridge.

    The regulator admits the rates are higher to pay for the card system. Does that mean that cash payers are unnecessarily paying more than they should? Should there be two rate meters, showing a cash price and a card price, such as gas stations show on huge signs?

    My experience driving a cab with the CMT system, is that it is unreliable, and confusing in the messages it displays for passengers and drivers alike.

    For example, the passenger completes entering their information on the rear compartment screen, swipes their card, presses the green OK button, and the screen says “your card will be charged $xx.00″. Yet, up front, the driver’s screen shows the “Waiting for authorization” message. The driver has no assurance at that point that the card is good, the transaction authorized. Passenger thinks “It’s been charged”. They exit into the street. Driver sees “declined” or “authorizer not available”. Driver does not get paid unless he chases down passenger, and convinces them to return to taxi and puzzle out cryptic gobble-de-gook messages. Passenger thinks “I saw message saying card will be charged”. Passenger thinks driver is bad. Driver thinks passenger doesn’t care if he is paid or not. “It’s the driver’s fault, not mine!” think so many of passengers when the card system messes up, as it so very often does.

    The documentation and training for drivers of a CMT equipped taxi is very inadequate and for key elements, completely missing. The most ludicrous example is in the laminated leaflet given out by CMT. It does not explain how to process a card transaction.

    I repeat, CMT’s printed instructions do not include instructions on how to process a card transaction.

    CMT does not have 24/7 service and repair for a 24/7 business. They don’t even have a CMT employed technician, as of early March.

    My card transaction payments are delayed 2 to 5 days, yet I have to pay my taxi lease fee and gas used, at the end of each shift. I cannot use the VISA labeled card onto which the card money is loaded, to pay my lease. I have to pay $1.50 each time I take cash from the CMT prepaid card at a Bank of America ATM. Withdraw from a different bank’s ATM? The fee is much higher…would you agree with a $4.50 fee to get your pay?

    Six percent is taken from the trip portion. Over the course of a year, that equals more than a week’s worth of net pay.

    So, to save passengers the heavy burden of paying cash, my pay is Delayed, Discounted, and I am Drained $1.50 or more to get paid.

    Do you have to pay $1.50 or more, to receive your paycheck?

    There are more glaring problems with wireless payments, but the regulators ignore them. Keep the fees flowing!

    • radbn

       As for the 6 percent, “the requirement for every taxi to have this kind of equipment was paid for by the last rate increase,” he says. “We built in a percentage of rate increase to cover that 6 percent.”

      what about that?

      • Adam A

        That was a lie. Shame on Mr. Cohen to ridiculously come up with that excuse. The last increase was for the starting fee from $2.25 to $2.60 (35 cents) to cover the gas increase.

  • Anonymous

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  • http://profiles.google.com/creditcardassistproducer Nicole Young

    I always want to use my credit card when I’m in cabs in Boston, why don’t more cabbies take them?

  • top cab passenger

    I’d just like to say that I use top cab/city cab 90% of the time, and have never had an issue with the card readers.   Yes, once in a while you get a grumpy driver, but driving a cab isn’t the best job in the world.  I tip well, act nice, and mostly have good luck.

  • Busy Traveler

    My company requires me to pay with credit card.  I don’t carry cash.  

  • Anonymous

    I was told today that I should have asked if he accepted credit cards before the trip started.  That the sign right there on the back of the seat, next to the credit card machine, saying “These cards accepted here.” didn’t ACTUALLY mean that they took credit cards.

    Um… yes, that’s exactly what it means.  If the machine is broken, tape a sign on it saying so.  Or take your cab into HQ and get it fixed.  But don’t get upset with me for believing what was written there.

  • Cabbiessuck

    Cabbies just want to scam you in Boston.  Its a fact.

  • AhdsPtn

    Drivers of a CMT equipped taxi is very inadequate and for key elements,
    completely missing. The most ludicrous example is in the laminated
    leaflet given out by CMT. It does not explain how to process a card
    transaction.We built in a percentage of rate increase to cover that 6 percent……………………..

  • Sam Herdy

    it’s funny how Mr. Cohen finds ridiculous excuses. Mr. Cohen is not an elected politician. He is a commissioner whose job is to enforce the law. Why would he campaign so hard for this taxi credit thing if he is not somehow personally benefiting from it? He claims that more people are taking cabs because of the CC. There was no way to track how many people were taking cabs prior to CCs.

  • John Bamako

    I drive a taxi in Boston and I have an account with paypal setup in my phone to accept credit cards. The fee is only 1.9% instead of this 6% . Why am I not allowed to use my preferred way to accept CC? Why is this City of Boston pushing this monopoly to use only 2 companies (Verifone and CMT) that are charging 6%?

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