Getting there by cab, and plastic

As part of a fare-hike plan, New York taxi drivers prepare to accept credit cards.

The minivan-taxi carrying Ellen Lewis Gideon approaches Grand Central Terminal, steering around double-parked delivery trucks and coming to a stop near a fire hydrant. In a hurry to catch her train, Ms. Gideon fumbles for the cash to pay the driver.

Groping for money while crammed in the back seat - almost every New Yorker knows the feeling. But by late next year, Gideon, a publicist who relies on cabs a lot, and other taxi customers will have an alternative: credit cards.

Yes, New York's famed taxis - the yellow icons of the street that inspired the TV show "Taxi" and movie "Taxi Driver" - are being dragged into the 21st century. The Taxi and Limousine Commission recently announced its goal to have all 12,000 cabs equipped with credit-card readers by November of next year. When it happens, New York's limousines for the common man will join those in Chicago, Washington, San Francisco, and Dallas, where cabs already take plastic.

Advocates offer two reasons for accepting cards: convenience and safety. Passengers want the option, and drivers, with less cash on hand, are less subject to robbery. Opponents question how secure the transaction will be, and many drivers are worried about forking over more earnings to credit-card companies.

The policy is part of the city's announcement of a 26 percent fare hike - the first in eight years, which took effect last week. This means each mile now costs $2 instead of $1.50.

Customers rarely ask to pay with a credit card, says Roland Jacques, a Brooklyn-based cabdriver who expresses concern about the added expense he is likely to incur. The equipment will cost hundreds of dollars, and the Taxi and Limousine Commission wants the industry to pay for it.

Additionally, cabbies will be expected to pay a transaction fee and some portion of the back-end processing fee charged by the credit-card companies. They might also pay a small part of the monthly cellular airtime fee assessed for credit-card transactions. But, say proponents of the plan, the extra income generated by the fare hike, along with the likelihood of rounded-up tips, should calm the cabbies' concerns.

Tell that to a cabdriver, though, and you will get a heated reply. "That wouldn't be good, that wouldn't be fair," says Mr. Jacques, who is waiting at a small dispatch center in Brooklyn. He says his financial burden is already barely supportable: The drivers' monthly expenses are now exacerbated by high gasoline prices.

Indeed, the business generates notoriously unreliable income. Some days Ronald Pierre, another New York cabdriver at the dispatch center, will make $200 or $300. Some days he will actually lose money. It will probably take Mr. Pierre about a month to pocket enough cash to pay for the new credit-card machine, he says. "If it's not to my advantage, why do I have to use it?"

The Taxi and Limousine Commission, however, is convinced that credit-card acceptance is to everyone's advantage, says Matthew Daus, its commissioner. "We'll be working hand in hand with the industry every step of the way," says Mr. Daus, who emphasizes the need to explore the options. Six hundred and fifty New York City cabs are now participating in a pilot project using credit cards. "The purpose of the pilot," says Daus, "is to see what usage actually is."

Information from other cities will be collected as well, and by early spring 2005 Daus anticipates that final specifications for the initiative will be approved by the full nine-member commission.

Still, Jeff Sheehy, who is visiting New York City and waiting in the taxi line before Grand Central Terminal, would never give a cabdriver his credit card. "Let's just say it's a security issue."

Ms. Gideon, on the other hand, can't wait. During a recent trip to Japan she was happy to have the option. "I used it all the time," she says.

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