Can the Octopus Card Extend Its Tentacles into the Netherlands?

Where China often leads the world in various technological and infrastructural innovations, Hong Kong has also been a forerunner in implementing various systems, particularly with the Octopus Card. Introduced in 1997, the Octopus Card quickly became one of the most successful smart cards in the world (Lok, n.d.). Initially launched for public transportation, the card usage has expanded far beyond metros and buses. The Octopus Card is used for a wide range of services, such as restaurants, parking facilities, even access to swimming pools. In fact, in some locations, the only possible way to pay is through the Octopus Card.

How was it possible for Octopus to expand into the food and retail sectors?

The similar characteristics between fast food payments and transportation fares, made the Octopus Card also try out that market. Regarding Hong Kong’s many snack and noodle shops, it is the perfect environment for the Octopus Card payment model, a quick and low-value transaction (Chau & Poon, 2003). As a result, the Octopus Card has evolved into a highly successful multi-use payment system. Its success is not only due to its transportation but also the integration into a wide range of industries, where it is now a part of daily life in Hong Kong.

The Netherlands has adopted a similar approach with the OV-Chipkaart. However, the question arises: could the OV-chipkaart expand in the same way that the Octopus Card has in Hong Kong and would it be beneficial?

Replicating Hong Kong’s success in the Netherlands is challenging due to the variety of payment methods, such as credit cards and iDEAL. The Dutch transport system is also more spread out, with different operators which would be harder to implement (Hermans et al., 2005). At last, the OV-chipkaart would probably not work in restaurants, as people will expect faster payments for smaller amounts.
_________________________________________________________________________________________

References

Lok, C. K. (z.d.). The Octopus in Hong Kong: The Success of a Smart Card-based E-payment System and Beyond. CSUSB ScholarWorks. https://scholarworks.lib.csusb.edu/ciima/vol4/iss4/8/

Chau, P. Y. K., & Poon, S. (2003). Octopus. Communications Of The ACM, 46(9), 129–133. https://doi.org/10.1145/903893.903927

Hermans, G., & Stoelinga, A. (2005). Competition in Dutch public transport. In Competition and Ownership in Land Passenger Transport. 8th International Conference (Thredbo 8) Transport Engineering ProgrammeFederal University of Rio de Janeiro, Brazil.