Why Customers Barely Benefit When Paying For Parking Spaces With An App

Why customers hardly benefit when they pay parking fees through the app

Parking spaces can be paid for using an app in more and more places. Communities save money in the medium term, application providers benefit from revenue sharing. And the consumers? So far you haven’t noticed any lower rates.

Lucien Fluri / ch media

Emmen just did it. Thun also a few weeks ago. And at Muttenz, you can now also pay per-app parking fees. More and more municipalities rely on digital payment solutions in addition to the classic parking meter: the market leader, Parkingpay, already specifies more than 650 locations where you can pay by application. New communities and cities are added every month.

This has advantages for the user: you do not need coins and the parking time can be adjusted to the minute: if you leave earlier, you pay less. But not only drivers can be happy. The digital business also allows new providers to participate in state parking fees: between four and six percent of digital revenue goes to app operators, as research from “Switzerland at the weekend” shows.

In Zurich alone, 24.1 million Swiss francs are charged in parking fees per year

Meanwhile, these are considerable amounts: because not only is the number of municipalities using the application growing. The number of users is also increasing considerably. The city of Zurich, for example, collects 24.1 million Swiss francs in parking fees each year. 30 percent of users now pay with Twint or app. Trend: keep increasing.

Cities like Aarau and St. Gallen earn nearly CHF 3.2 million in parking fees. While 13 percent of users paid through the app in St. Gallen in 2019, it was already 25. In the medium term, in Solothurn, for example, 40 percent is assumed.

The digital market is heading towards a provider

And one provider in particular is running: the market leader is Dietikon’s Digitalparking Parkingpay app. More and more municipalities trust them (or the Twint solution integrated in the application), also because it is assumed that consumers do not want more than one application on their mobile phone.

In many places where Parkingpay is used, payment via the European Easypay app is also possible. This charges parkers 19 cents per hour. The user has de facto a sharp increase in the parking fee. The application is voluntary and Easypark is used mainly by foreign drivers, according to the cities on the quasi-fare increase. Payment with coins is still possible.

Cities save, also because parking meters are expensive

Parkingpay is active in a growing market. But CEO Reto Schläpfer contradicts that it’s big business. The company performs development and support work. Above all, however, the margin is low: although digital parking receives 4 to 6 percent of the paid parking fee, it transfers a larger share to: More than 3 percent of the total paid parking fee is used for processing payments. Also, the minimum fee per transaction is ten cents. Credit card providers also benefit from the business.

While the consumer benefits to some extent, municipalities can save huge amounts of money according to Parkingpay: there are less emptying and maintenance costs for parking meters, and the number of expensive devices can be reduced in the medium term. “We were able to save printing and submitting paper permits,” says St. Gallen, for example. “The fee is very small and proportionate,” emphasizes Patrick Schnellmann from Emmen (LU). And Heiko Cicieri from the city of Zurich adds:

Internal development is not worth it for any city, says CEO Schläpfer. Even in large European cities, your own application is “always more expensive in total cost accounting”. In fact, there are almost no special offers or collaborations between the communities.

Basel follows its own path, also for data protection

Basel-Stadt has recently gone its own way, where the app was developed. The operation costs around 16,000 francs a year, the development costs 102,000 francs. In the medium and long term, the city wants to be able to improve its parking management. For example, available parking spaces are displayed in the app. And in addition to costs, it was also important for Basel:

Because data protection is a delicate issue with applications: you have to give the license plate of the car to park. It would take little to create a user movement profile. But you should be aware of that, says digital parking. The company has its own detailed privacy policy. According to CEO Reto Schläpfer, the data is used “exclusively to process and control the parking fee.”

Depending on the location, the data remains accessible for up to six months; The latter, for example, to process bus complaints. Furthermore, municipalities can only process the data for the management of parking spaces, not for criminal proceedings. However, data is only destroyed at the company when a user cancels their account. “Many users want proof of transaction history and, for companies, storage for up to 10 years is even mandatory under the Code of Obligations,” says Managing Director Schläpfer. (aargauerzeitung.ch)