Octopus card
Encyclopedia
The Octopus card is a rechargeable contactless
stored value smart card
used to transfer electronic payments
in online or offline systems in Hong Kong
. Launched in September 1997 to collect fares for the territory's mass transit system, the Octopus card system was the first contactless smart card
system in the world and has since grown into a widely used payment system for virtually all public transport in Hong Kong
.
The Octopus is also used for payment at convenience store
s, supermarket
s, fast-food restaurants, on-street parking meter
s, car parks, and other point-of-sale
applications such as service stations
and vending machine
s.
The Octopus card is recognised internationally, winning the Chairman's Award of the World Information Technology and Services Alliance
's 2006 Global IT Excellence Award for being the world's leading complex automatic fare collection and contactless smartcard payment system, and for its innovative use of technologies. According to Octopus Cards Limited, operator of the Octopus card system, there are more than 20 million cards in circulation, nearly three times the population of Hong Kong. The cards are used by 95% of the population of Hong Kong aged 16 to 65, generating over 11 million daily transactions worth a total over HK$100 million (US$12.8 million) everyday.
The slogan of Octopus Card Limited and its products (the cards) is Making Everyday Life Easier, which is part of the mission statement of the corporation.
), one of Hong Kong's railways, adopted a system to recirculate magnetic plastic cards
as fare tickets when it started operations in 1979. Another of the territory's railway networks, the Kowloon-Canton Railway
(KCR), adopted the same magnetic cards in 1984, and the stored value version was renamed Common Stored Value Ticket. In 1989, the Common Stored Value Ticket system was extended to Kowloon Motor Bus
(KMB) buses providing a feeder service to MTR and KCR stations and to Citybus
, and was also extended to a limited number of non-transport applications, such as payments at photobooths and for fast food vouchers.
The MTR Corporation
eventually decided to adopt more advanced technologies, and in 1993 announced that it would move towards using contactless smartcards. To gain wider acceptance, it partnered with four other major transit companies in Hong Kong to create a joint-venture business to operate the Octopus system in 1994, then known as Creative Star Limited. The Octopus system was launched after three years of trials on 1 September 1997. Three million cards were issued within the first three months of the system's launch. The main reason for the quick success of the system was that the MTR and KCR required that all holders of Common Stored Value Tickets replace their tickets with Octopus cards in three months or have their tickets made obsolete, thus forcing their combined base commuters to switch quickly. Another reason is the coin shortage in Hong Kong in 1997; there was a belief that the older Queen's Head coins in Hong Kong would appreciate in value, so many people hoarded the older coins and waited for their value to increase. The Octopus system was quickly adopted by other Creative Star joint venture partners, and KMB reported that by 2000, most bus journeys were completed using an Octopus card, with few coins used. Boarding a bus in Hong Kong without using the Octopus card requires giving exact change; this is cumbersome compared to using the Octopus card. By November 1998, 4.6 million cards were issued, and this rose to 9 million by January 2002.
In 2000, the Hong Kong Monetary Authority
granted a deposit-taking company license to the operator, removing previous restrictions that prohibited Octopus from generating more than 15 percent of its turnover from non-transit related functions, thus allowing the Octopus card to be widely adopted for non-transit-related sales transactions. On 29 June 2003, the Octopus card found another application when the Hong Kong Government started to replace all its 18,000 parking meters with a new Octopus card operated system. The replacement was completed on 21 November 2004.
in that it is often used to indicate "many". For instance, the idiom sei tùng baat daaht is a common expression loosely translated as "reachable in all directions". It is also considered a lucky number in Chinese culture, and the phrase baat daaht can possibly be associated with the similar-sounding faat daaht, which means "getting rich" in the local dialect.
The English
name Octopus card was also selected from the naming competition, and coincides with the number eight in the Cantonese name, since an octopus
has eight tentacle
s. It is also particularly appropriate since an octopus is able to grab many things at the same time and this ability is conferred to its cardholders who can use it in many different types of transactions.
The logo used on the card features a Möbius strip
twisted sideways and into the shape of the Arabic numeral
for the number eight, 8, to indicate the card's "infinite" possibilities. The "∞", looks like a sideways 8.
On-Loan cards are issued for usage in day-to-day functions, primarily for fare payment in transport systems. They are further classified into Child, Adult, Elder, and Personalised categories, with the first three based on age and different amounts of fare concession. With the exception of the Personalised cards, On-Loan cards are anonymous; no personal information, bank account, or credit card details are stored on the card, and no identification is required for the purchase of these cards. If an owner loses a card, only the stored value and the deposit of the card are lost. On-Loan Octopus cards may be purchased at all MTR stations, the KMB Customer Service Centre, New World First Ferry
(NWFF) Octopus Service Centres, and the New World First Bus
(NWFB) Customer Service Centre. A student on-loan Octopus Card was initially issued, but was discontinued in 2005.
The rainbow-coloured Personalised card is available on registration. The name and, if opted, a photo of the holder are imprinted on the cards. They can function automatically as a Child, Adult, or Elder card by recognising the cardholder's age stored on the card, hence accounting for different concessionary fares. As of 2003, there were 380,000 holders of Personalised Octopus cards. In addition to all the functions of an ordinary card, this card can be used as a key card for access to residential and office buildings. If a Personalised card is lost, the holder may report the loss by phone to prevent unauthorised use of the card. A refund would then be issued to the holder of the card for the deposit and the value that remained on the card six hours after the loss is reported, minus a HK$30 card cost and a HK$20 handling fee.
A Personalised card with "student status" is available for students in Hong Kong. To be eligible for this card, the applicant must be a full-time Hong Kong student aged between 12 and 25. This type of Personalised card is automatically issued to a student who applies for student concessionary privileges. Additionally, they can be used for school administrative tasks such as the recording of student attendance and the management of library loans.
In contrast to On-Loan cards, Sold cards are sponsored and branded cards. They are souvenir cards that are frequently released by Octopus Cards Limited. The designs for these cards usually come from fictional characters in popular culture, or they are inspired by Chinese cultural events such as Chinese New Year
. These cards are sold at a premium, have limited or no initial stored value, and cannot be refunded, but they can otherwise be used as ordinary cards. An example of the Sold card is the Mcmug
and Mcdull
collection. It was launched at the end of January 2007 to coincide with the beginning of the Year of the Pig
, it features two differently designed versions of the card and is sold for HK$138 per set. Each set comes with an Adult Octopus card, with a pouch for the card, a matching strap and a Mcmug or Mcdull ornament. Octopus Cards Limited has launched new collections of these cards for such occasions as the Mid-Autumn Festival
, the passing of the year 2004, and the release of the movie DragonBlade
. Sold Octopus cards may be purchased at selected MTR stations, and all 7-Eleven
stores.
The special-purpose card, Airport Express Tourist Octopus, was introduced by Octopus Cards Limited to target tourists in Hong Kong
. Two versions of this card are offered, a HK$220 card with a free single ride on the Airport Express
, the Mass Transit Railway (MTR) train line that runs between the Hong Kong International Airport
and the urban areas of Hong Kong, and a HK$300 card with two free single rides included. The airport journeys are valid for 180 days from the date of purchase. Both versions allow three days of unlimited rides on the MTR and include a HK$50 refundable deposit. Usable value on these cards may be added if necessary. These tourist Octopus cards may be used only by tourists staying in Hong Kong for 14 or fewer days; users may be required to produce a passport showing their arrival date in Hong Kong. Airport Express Tourist Octopus is available for purchase at all MTR stations.
The other special-purpose card, the MTR Airport Staff Octopus, is available for the staff of Hong Kong International Airport and AsiaWorld-Expo
, a convention centre close to the airport, for commuting at a reduced fare between the airport and MTR stations via the Airport Express. Staff who apply for the card may use it for a discount of up to 64 percent for Airport Express single journey fares. The MTR Airport Staff Octopus is available upon application via the company for which that a staff member works.
The Octopus card was introduced for fare payment on the MTR initially, but the use of the card quickly expanded to other retail businesses in Hong Kong. The card is now commonly used in most, if not all, major public transport, fast food restaurants, supermarkets, vending machiness, convenient stores, photo booth
s, parking meters, car parks
and many other retails business where small payment are frequently made by customers. As of 21 November 2004, all parking meters in Hong Kong were converted. They no longer accept coins and Octopus became the only form of payment accepted.
Notable businesses that started accepting Octopus cards at the very early stage include PARKnSHOP
, Wellcome
, Watsons, 7-Eleven
, Starbucks
, McDonald's
, Circle K
, etc.
Octopus cards also double as access control cards in buildings and for school administrative functions. At certain office buildings, residential buildings, and schools, usage of an Octopus card is required for entry.
Making or recording a payment using the card for public transport or purchases at Octopus-enabled retailers can be done by holding the card against or waving it over an Octopus card reader from up to a few centimetres away without the user taking out the card. The reader will acknowledge payment by emitting a beep sound, and display the amount deducted and the remaining balance of the card. Standard transaction time for readers used for public transport is 0.3 seconds, while that of readers used for retailers is 1 second. When riding the MTR system, the entry point of commuters is noted when a passenger enters, and the appropriate amount based on distance traveled will be deducted when the users show their card again at the exit point.
The MTR charge less for journeys made using an Octopus card instead of conventional single-journey tickets. For example, the adult fare of a single journey from Chai Wan to Tung Chung is HK$20.70 with an Octopus card, and HK$23.50 with a single journey ticket. Other public transport operators also offer intermittent discounts for using Octopus cards on higher fares and round-trip transits on select routes.
On 6 November 2005, Octopus Cards Limited launched Octopus Rewards, a program that allows cardholders to earn rewards at merchants that are partners in the program. Participating merchants provide consumers with tailor-made offers and privileges. The rewards that the program offers are in the form of points, or reward dollars, stored on the card. Once a card is registered for the program, the cardholder may accumulate reward points by making purchases at participating merchants, and payments may be made in the form of cash, credit cards, or Octopus cards themselves. The rate at which reward points are earned per dollar-amount purchase differs by the merchant at which that the purchases are made. At Wellcome
, for example, one point is earned for every purchase of HK$200; and at Watsons, points are earned at a rate of 0.5 percent per dollar amount of a purchase. Once these reward dollars are accumulated, they may be redeemed as payment for purchases at partner merchants for at least HK$1 per reward dollar. To redeem the accumulated reward dollars, cardholders must use the entire value amount in whole, and may not elect to use it partially. If the purchase price is lower than the amount of reward dollars available, the amount difference remains stored on the card. Founding partners for the Octopus Rewards program include HSBC
, UA Cinemas, Watsons, Wellcome, and McDonald's.
In MTR stations, enquiry machines can be found where cardholders may place their Octopus cards on the machines and the machines will display the balances along with a history of last 10 usages.
Monetary value can be added to the card through a number of ways. Add Value Machines, located at MTR stations, can be used to add more value to the cards. The machines accept cash, and selected machines are also able to accept Electronic Funds Transfer
. Alternatively, value may be added with cash at authorised service providers such as PARKnSHOP, Wellcome, Watsons, 7-Eleven, Circle K, and Café de Coral
, and also at customer service centres and ticketing offices at other transport stations.
An Octopus card may store a maximum value of HK$1,000, with an On-Loan card having an initial deposit value of HK$50 and a Sold card having no initial deposit value. Negative value is incurred on a card if it is used with insufficient funds—both types of cards may carry a maximum negative value of HK$35 before value needs to be added to them again for use. At the time, the maximum cost of a trip on any of the rail networks except the Airport Express and first class of the MTR East Rail line was HK$34.8, the cost of travelling between East Tsim Sha Tsui Station and Lo Wu Station; the current maximum cost is $47.5, the cost of travelling between Disneyland Resort Station and either Lo Wu Station or Lok Ma Chau Station.
The Octopus Automatic Add Value Service (AAVS) is another method by which cardholders may add value to their cards. This service allows for money to be automatically deducted from a credit card and added to an Octopus card when the value of the Octopus card is less than zero dollars. The credit card used must be one offered by one of 22 financial institutions that participate in AAVS. Participating banks include HSBC
, Bank of China
, and Hang Seng Bank
. HK$250 is added to the card each time value is automatically added; six participating financial institutions offer an option of adding a value of HK$500 instead.
An Octopus card may be returned to any MTR Customer Service Centre for a refund of the remaining value stored on it. A handling fee may be charged for the refund; HK$7 for an anonymous On-Loan card that had been in use for fewer than three months, and HK$10 for a Personalised On-Loan card that was issued on or after 1 November 2004. A refund is immediately provided at the time an anonymous On Loan card is returned, unless it has more than HK$500 stored on it. A Personalised On-Loan card or an anonymous On-Loan card with more than HK$500 stored on it needs to be sent back to Octopus Cards Limited for refund processing, in which case, the refund for a Personalised On-Loan card would be available in eight days, and that of an anonymous On-Loan card would be available in five days. If a damaged card is returned for refund, a HK$30 levy would be charged to the cardholder.
The Octopus system was designed by Australia-based company ERG Group (now Vix Technology). The company was selected in 1994 to lead the development of the Octopus project and was responsible for the building and installation of the components of the Octopus system. Operations, maintenance and development was undertaken by Octopus Cards Limited, and in 2005, it replaced the central transaction clearing house with its own system.
The Octopus card uses the Sony
13.56 MHz FeliCa
radio frequency identification (RFID) chip, and Hong Kong is the home of the world's first major public transport system using this technology. This is a "touch and go" system, so users need only hold the card in close proximity of the reader, and thus physical contact is not required. Data is transmitted at up to 212 kbit/s (the maximum speed for Sony FeliCa chips), compared to 9.6 kbit/s for other smart card systems like Mondex
and Visa Cash
. The card has a storage capacity of 1 KB
to 64 KB compared to the 125 byte
s provided by traditional magnetic stripe card.
Octopus uses a nonstandard system for RFID instead of the ISO/IEC 14443 standards, since there were no standards in the nascent industry during its development in 1997. The operating range of the reader/writer is between 30 and 100 mm (1.18 and 3.94 in) depending on the type of model being used.
Octopus is specifically designed so that card transactions are relayed for clearing on a store and forward
basis, without any requirement for reader units to have realtime
round-trip communications with a central database or computer. The stored data about the transaction may be transmitted by network after hours, or in the case of offline mobile readers may be retrieved by a hand held device, for example a Pocket PC
.
In practice, different data collection mechanisms are used by different transport operators, depending on the nature of their business. The MTR
equips its stations with local area network
s that connect the components that deal with Octopus cards—turnstile
s, Add Value Machines, value-checking machines and customer service terminals. Transactions from these stations are relayed to the MTR's Kowloon Bay
headquarters through a frame relay
wide area network
, and hence onwards to the central clearing house system (CCHS) for clearing. Similar arrangements are in place for retailers such as 7-Eleven
. Handheld devices are used to scan offline mobile readers, including those installed on minibuses. Buses either use handheld devices or a wireless system, depending on operator.
for all airborne communication and performs mutual authentication
between the card and reader based on the ISO 9798-2 three-pass mutual authentication protocol. In other words, data communications are only established when the card and reader have mutually authenticated based on a shared secret
access key. This means that the security of the Octopus card system would be jeopardized should the access key be exposed. A stolen Octopus card reader could be used with stolen Octopus software, for example, to add value (up to HK$1,000) to any Octopus card without authorization. Nevertheless, as of 2003, the Octopus card and system have never been successfully hacked
.
Octopus card reader includes a fail-safe
that prevents reader from initiating transaction when more than one card is being detected at the same time. On 11 February 2009, Sing Tao Daily
reported that the fail-safe has been abused for fare evasion
through the railway station turnstile. A large amount of dishonest passengers at Sheung Shui Station and Lo Wu Station were stacking up 4 or more cards before breaking through the turnstile, pretending their cards have been touched with the reader correctly but triggering the fail-safe deliberately to avoid card value deduction. Because of this, if they get caught by the station staff, they can make an excuse of a hardware malfunction and offer the Octopus card with an unsuccessful transaction.
. The company was founded as Creative Star Limited in 1994 to oversee the development and implementation of the Octopus card system, and was renamed as its current name of Octopus Cards Limited in 2002. Creative Star was formed as a joint-venture company by five major transit companies in Hong Kong—MTR Corporation
, Kowloon-Canton Railway Corporation
, Kowloon Motor Bus
, Citybus
, and Hongkong and Yaumati Ferry
. In January 2001, the shares of Hongkong and Yaumati Ferry in the company was transferred to New World First Bus
and New World First Ferry
. In the same year, together with MTR Corporation, the company was transformed from its previous non-profit making status to a profit making enterprise.
Due to the expansion of the company's businesses, Octopus Holdings Limited was established in 2005 and Octopus Cards Limited was restructured as its subsidiary. The business of Octopus Cards Limited, being a payment business, is regulated by the Hong Kong Monetary Authority
, while Octopus' non-payment businesses are not subjected to such regulation and are operated by other subsidiaries of Octopus Holdings Limited that are independent of Octopus Cards Limited. As of 2007, Octopus Holdings Limited was a joint-venture business owned by five transport companies in Hong Kong; 54.4% by the MTR Corporation, 22.1% by the Kowloon-Canton Railway Corporation, 12.4% by Kowloon Motor Bus, 5% by Citybus, and 3.1% by New World First Bus. Since the Government of Hong Kong
owns 76.54% of the MTR Corporation (as of 31 December 2005) and wholly owns the Kowloon-Canton Railway Corporation, it is the biggest effective shareholder of Octopus Holdings Limited, and thus also the biggest effective shareholder of Octopus Cards Limited.
Initially, Octopus Cards Limited, then known as Creative Star Limited, was restricted to having at most 15 percent of Octopus card transactions for non-transport transactions, as it operated under the Hong Kong government's Banking Ordinance
. On 20 April 2000, the Hong Kong Monetary Authority authorised the company for deposit-taking, which allowed for 50 percent of Octopus card transactions to be unrelated to transport. HK$416 million (US$53.3 million) is deposited in the Octopus system at any given time as of 2000.
do not accept the Octopus card. On 27 June 2006, after 10 years of negotiations between Octopus Cards Limited and the taxi industry, the first trial of taxis equipped with Octopus card readers was launched in the New Territories
with taxis operated by the Yellow Taxi Group. But it was reported on 30 October that of the 20 taxis that participated in the trial, eight had dropped out. Part of the reason was technical—drivers must return to the office every day for accounting. The Octopus card company said it would be upgrading the system to allow automatic account updating in the future. Wong Yu-ting, managing director of the Yellow Taxi Group, also noted that they had been "trying to convince restaurants and retailers" to offer discounts to Octopus taxi passengers, but the Transport Department
had been a major obstacle. The Transport Department is against this approach for legal reasons.
Other than the Octopus card itself, operator Octopus Cards Limited also sells watches and mobile phone covers that function as anonymous Octopus cards. The types of watches available include wrist watches, pocket watches, and watch key chains. The mobile phone covers were specifically designed for Nokia
models 3310
and 3330. As with the card itself, these products are used by waving them over a card reader. They may be reloaded with money value the same way as the card itself, including automatic reloading via the Automatic Add Value Service, with the exception that they cannot be reloaded at Add Value Machines due to their shapes. An Octopus watch or mobile phone cover may be stored with a maximum of HK$1,000, but do not have any initial stored value at the time of its purchase. It may have a maximum negative value of HK$35 as with an Octopus card. These products are not refundable for their costs, but the remaining value stored on them may be refunded if they are damaged, with the damaged product itself also returned to the customer.
In June 2007, a new set of limited edition products was announced, featuring Mini Octopus cards and Child Octopus Wristbands. The Mini Octopus cards, available in Adult and Elder editions, measure 4.7 cm by 3 cm (1.85 in by 1.18 in) and work as regular (anonymous) Adult and Elder, respectively, Octopus cards. The Child Octopus Wristbands are plastic wristbands with a watch-like round face and work as regular Child Octopus cards. The same value-adding abilities and limitations as the aforementioned watches and mobile phone apply.
and Macau
in 2006. In collaboration with China UnionPay
, Octopus Cards Limited introduced Octopus card usage to two Fairwood restaurants
in Shenzhen in August 2006. In 2008, five Café de Coral
locations in Shenzhen also started accepting Octopus. Value cannot be reloaded to Octopus cards in Shenzhen, but the Automatic Add Value Service is available to automatically deduct money value from a customer's credit card to reload an Octopus card. The two Fairwood restaurants in Shenzhen that were enabled for Octopus card payments are located at Luohu Commercial City and Shenzhen Railway Station
. Shenzhen became the first city outside Hong Kong in which Octopus cards may be accepted as payment. In Macau, the Octopus card was introduced in December 2006 when two Kentucky Fried Chicken restaurants in the territory adopted its usage as payment. Similar to its usage in Shenzhen, an Octopus card may not be reloaded in Macau, and the currency exchange rate between the Macanese pataca
and the Hong Kong dollar when using an Octopus card is MOP1:HKD1. The two Kentucky Fried Chicken restaurants in Macau that adopted the Octopus card for payment are located at the Rua Do Campo and the Sands Casino
.
In February 2007, it was found that when customers added value to their cards at self-service add-value points located in MTR and KCR stations, their bank accounts would be debited even if the transactions were cancelled. Octopus Cards Limited claimed that the fault was due to an upgrade of communication systems. Initially, two cases were reported. The company then announced that the use of the payment system, Electronic Payment Services
(EPS), in add-value service points would be suspended until further notice, and had started investigation of the system's mistake.
On 27 July 2007, a report was announced that the wrong transactions could be traced back to 2000, and a total of 3.7 million Hong Kong dollars was wrongly deducted from 15,270 cases. The company reported that there may be cases dating before 2000, because only transactions from the past seven years were kept. It stated that it would co-operate with EPS Company Limited, operator of Electronic Payment Services, and banks to contact customers involved and arrange a refund within ten weeks' time.
On 21 December 2007, the company announced to permanently cease all transactions completed using EPS because they cannot guarantee such events from happening again.
Contactless payment
Contactless payment systems are credit cards and debit cards, key fobs, smartcards or other devices which use RFID for making secure payments. The embedded chip and antenna enable consumers to wave their card or fob over a reader at the point of sale. Some suppliers claim that transactions can be...
stored value smart card
Smart card
A smart card, chip card, or integrated circuit card , is any pocket-sized card with embedded integrated circuits. A smart card or microprocessor cards contain volatile memory and microprocessor components. The card is made of plastic, generally polyvinyl chloride, but sometimes acrylonitrile...
used to transfer electronic payments
Electronic money
Electronic money is money or scrip that is only exchanged electronically. Typically, this involves the use of computer networks, the internet and digital stored value systems...
in online or offline systems in Hong Kong
Hong Kong
Hong Kong is one of two Special Administrative Regions of the People's Republic of China , the other being Macau. A city-state situated on China's south coast and enclosed by the Pearl River Delta and South China Sea, it is renowned for its expansive skyline and deep natural harbour...
. Launched in September 1997 to collect fares for the territory's mass transit system, the Octopus card system was the first contactless smart card
Contactless smart card
A contactless smart card is any pocket-sized card with embedded integrated circuits that can process and store data, and communicate with a terminal via radio waves. There are two broad categories of contactless smart cards. Memory cards contain non-volatile memory storage components, and perhaps...
system in the world and has since grown into a widely used payment system for virtually all public transport in Hong Kong
Transport in Hong Kong
Hong Kong has a highly developed and sophisticated transport network, encompassing both public and private transport. Over 90% of the daily journeys are on public transport, making it the highest rate in the world....
.
The Octopus is also used for payment at convenience store
Convenience store
A convenience store, corner store, corner shop, commonly called a bodega in Spanish-speaking areas of the United States, is a small store or shop in a built up area that stocks a range of everyday items such as groceries, toiletries, alcoholic and soft drinks, and may also offer money order and...
s, supermarket
Supermarket
A supermarket, a form of grocery store, is a self-service store offering a wide variety of food and household merchandise, organized into departments...
s, fast-food restaurants, on-street parking meter
Parking meter
A parking meter is a device used to collect money in exchange for the right to park a vehicle in a particular place for a limited amount of time. Parking meters can be used by municipalities as a tool for enforcing their integrated on-street parking policy, usually related to their traffic and...
s, car parks, and other point-of-sale
Point of sale
Point of sale or checkout is the location where a transaction occurs...
applications such as service stations
Filling station
A filling station, also known as a fueling station, garage, gasbar , gas station , petrol bunk , petrol pump , petrol garage, petrol kiosk , petrol station "'servo"' in Australia or service station, is a facility which sells fuel and lubricants...
and vending machine
Vending machine
A vending machine is a machine which dispenses items such as snacks, beverages, alcohol, cigarettes, lottery tickets, consumer products and even gold and gems to customers automatically, after the customer inserts currency or credit into the machine....
s.
The Octopus card is recognised internationally, winning the Chairman's Award of the World Information Technology and Services Alliance
World Information Technology and Services Alliance
The World Information Technology and Services Alliance is a consortium of associations from the information technology industry around the world. The group claims that it represents over 90% of the world IT market, and has a stated goal of advancing the growth and development of the IT industry...
's 2006 Global IT Excellence Award for being the world's leading complex automatic fare collection and contactless smartcard payment system, and for its innovative use of technologies. According to Octopus Cards Limited, operator of the Octopus card system, there are more than 20 million cards in circulation, nearly three times the population of Hong Kong. The cards are used by 95% of the population of Hong Kong aged 16 to 65, generating over 11 million daily transactions worth a total over HK$100 million (US$12.8 million) everyday.
The slogan of Octopus Card Limited and its products (the cards) is Making Everyday Life Easier, which is part of the mission statement of the corporation.
History
The Mass Transit Railway (MTRMTR
Mass Transit Railway is the rapid transit railway system in Hong Kong. Originally opened in 1979, the system now includes 211.6 km of rail with 155 stations, including 86 railway stations and 69 light rail stops...
), one of Hong Kong's railways, adopted a system to recirculate magnetic plastic cards
Magnetic stripe card
A magnetic stripe card is a type of card capable of storing data by modifying the magnetism of tiny iron-based magnetic particles on a band of magnetic material on the card...
as fare tickets when it started operations in 1979. Another of the territory's railway networks, the Kowloon-Canton Railway
Kowloon-Canton Railway
The Kowloon–Canton Railway refers to a railway network in Hong Kong which is now combined with the MTR railway system, comprising rapid transit services, a light rail system and feeder bus routes within Hong Kong, and intercity passenger and freight train services to the rest of China...
(KCR), adopted the same magnetic cards in 1984, and the stored value version was renamed Common Stored Value Ticket. In 1989, the Common Stored Value Ticket system was extended to Kowloon Motor Bus
Kowloon Motor Bus
The Kowloon Motor Bus Company Limited , a company of the Transport International Holdings Limited, is the largest franchised bus operators in Hong Kong, and one of the largest privately owned public bus operators in the world...
(KMB) buses providing a feeder service to MTR and KCR stations and to Citybus
Citybus (Hong Kong)
Citybus Limited is one of the three major bus operators in Hong Kong. It provides both franchised and non-franchised bus service. The franchised route network serves mainly Hong Kong Island, cross-harbour routes , Ocean Park, North Lantau and Hong Kong International Airport...
, and was also extended to a limited number of non-transport applications, such as payments at photobooths and for fast food vouchers.
The MTR Corporation
MTR Corporation
MTR Corporation Limited is a company listed on the Hong Kong Exchange and included in the Hang Seng Index. MTR owns and runs the Hong Kong MTR metro system, and is also a major property developer and landlord in Hong Kong...
eventually decided to adopt more advanced technologies, and in 1993 announced that it would move towards using contactless smartcards. To gain wider acceptance, it partnered with four other major transit companies in Hong Kong to create a joint-venture business to operate the Octopus system in 1994, then known as Creative Star Limited. The Octopus system was launched after three years of trials on 1 September 1997. Three million cards were issued within the first three months of the system's launch. The main reason for the quick success of the system was that the MTR and KCR required that all holders of Common Stored Value Tickets replace their tickets with Octopus cards in three months or have their tickets made obsolete, thus forcing their combined base commuters to switch quickly. Another reason is the coin shortage in Hong Kong in 1997; there was a belief that the older Queen's Head coins in Hong Kong would appreciate in value, so many people hoarded the older coins and waited for their value to increase. The Octopus system was quickly adopted by other Creative Star joint venture partners, and KMB reported that by 2000, most bus journeys were completed using an Octopus card, with few coins used. Boarding a bus in Hong Kong without using the Octopus card requires giving exact change; this is cumbersome compared to using the Octopus card. By November 1998, 4.6 million cards were issued, and this rose to 9 million by January 2002.
In 2000, the Hong Kong Monetary Authority
Hong Kong Monetary Authority
The Hong Kong Monetary Authority or HKMA is Hong Kong's central banking institution . It is a government authority founded on 1 April 1993 via the consolidation of "Office of the Exchange Fund" and the "Office of the Commissioner of Banking"...
granted a deposit-taking company license to the operator, removing previous restrictions that prohibited Octopus from generating more than 15 percent of its turnover from non-transit related functions, thus allowing the Octopus card to be widely adopted for non-transit-related sales transactions. On 29 June 2003, the Octopus card found another application when the Hong Kong Government started to replace all its 18,000 parking meters with a new Octopus card operated system. The replacement was completed on 21 November 2004.
Etymologies and logo
The Cantonese name for the Octopus card, Baat Daaht Tùng , translates literally as "eight-arrived pass" (though in Chinese it was accepted as "go-everywhere pass"), where Baat Daaht may translate as "reaching everywhere". It was selected by the head of the MTR Corporation, the parent company of Octopus Cards Limited, in a naming competition held in 1996. The number eight is a significant number in ChineseChinese language
The Chinese language is a language or language family consisting of varieties which are mutually intelligible to varying degrees. Originally the indigenous languages spoken by the Han Chinese in China, it forms one of the branches of Sino-Tibetan family of languages...
in that it is often used to indicate "many". For instance, the idiom sei tùng baat daaht is a common expression loosely translated as "reachable in all directions". It is also considered a lucky number in Chinese culture, and the phrase baat daaht can possibly be associated with the similar-sounding faat daaht, which means "getting rich" in the local dialect.
The English
English language
English is a West Germanic language that arose in the Anglo-Saxon kingdoms of England and spread into what was to become south-east Scotland under the influence of the Anglian medieval kingdom of Northumbria...
name Octopus card was also selected from the naming competition, and coincides with the number eight in the Cantonese name, since an octopus
Octopus
The octopus is a cephalopod mollusc of the order Octopoda. Octopuses have two eyes and four pairs of arms, and like other cephalopods they are bilaterally symmetric. An octopus has a hard beak, with its mouth at the center point of the arms...
has eight tentacle
Tentacle
A tentacle or bothrium is one of usually two or more elongated flexible organs present in animals, especially invertebrates. The term may also refer to the hairs of the leaves of some insectivorous plants. Usually, tentacles are used for feeding, feeling and grasping. Anatomically, they work like...
s. It is also particularly appropriate since an octopus is able to grab many things at the same time and this ability is conferred to its cardholders who can use it in many different types of transactions.
The logo used on the card features a Möbius strip
Möbius strip
The Möbius strip or Möbius band is a surface with only one side and only one boundary component. The Möbius strip has the mathematical property of being non-orientable. It can be realized as a ruled surface...
twisted sideways and into the shape of the Arabic numeral
Arabic numerals
Arabic numerals or Hindu numerals or Hindu-Arabic numerals or Indo-Arabic numerals are the ten digits . They are descended from the Hindu-Arabic numeral system developed by Indian mathematicians, in which a sequence of digits such as "975" is read as a numeral...
for the number eight, 8, to indicate the card's "infinite" possibilities. The "∞", looks like a sideways 8.
Types of cards
There are two main types of Octopus card (On-Loan and Sold), and two less common types (the Airport Express Tourist and the MTR Airport Staff).On-Loan cards are issued for usage in day-to-day functions, primarily for fare payment in transport systems. They are further classified into Child, Adult, Elder, and Personalised categories, with the first three based on age and different amounts of fare concession. With the exception of the Personalised cards, On-Loan cards are anonymous; no personal information, bank account, or credit card details are stored on the card, and no identification is required for the purchase of these cards. If an owner loses a card, only the stored value and the deposit of the card are lost. On-Loan Octopus cards may be purchased at all MTR stations, the KMB Customer Service Centre, New World First Ferry
New World First Ferry
New World First Ferry Services Limited is a ferry service company in Hong Kong. The company was established in November 1999, when it took over the 8 licensed ferry routes transferred from the Hongkong and Yaumati Ferry...
(NWFF) Octopus Service Centres, and the New World First Bus
New World First Bus
New World First Bus Services Limited , abbreviated as First Bus and "NWFB", is the third largest public bus operator in Hong Kong.NWFB was established in 1998, taking over China Motor Bus's franchise on 1 September 1998 to provide bus services on Hong Kong Island together with Citybus...
(NWFB) Customer Service Centre. A student on-loan Octopus Card was initially issued, but was discontinued in 2005.
| Type | Picture/Colour | Cost and use |
|---|---|---|
| Child |  |
Children aged between 3 and 11. This card is sold for HK$70 with an initial value of HK$20. Children's fares are deducted where applicable. |
| Student |  |
For students attending secondary schools and universities. Discontinued in 2005 and replaced by Personalised Octopus Card. |
| Adult |  |
The standard version of the Octopus card. This card is sold for HK$150 with an initial value of HK$100. This colour is also used for the logo of Octopus Cards Limited, the operator. |
| Elder |  |
Eligibility varies between different public transport companies, and even between operating routes of the same type of service—for example, 60 years of age or above for Citybus, 65 for KMB. If no elder fares are available, adult fares are deducted. This card is sold for HK$70 with an initial value of HK$20. |
| Personalised |  |
The rainbow-coloured Personalised card is available on registration. This card is sold for HK$100 with an initial value of HK$30 and a handling charge of HK$20. Students may also qualify for this card at HK$90 with their pictures and names. |
The rainbow-coloured Personalised card is available on registration. The name and, if opted, a photo of the holder are imprinted on the cards. They can function automatically as a Child, Adult, or Elder card by recognising the cardholder's age stored on the card, hence accounting for different concessionary fares. As of 2003, there were 380,000 holders of Personalised Octopus cards. In addition to all the functions of an ordinary card, this card can be used as a key card for access to residential and office buildings. If a Personalised card is lost, the holder may report the loss by phone to prevent unauthorised use of the card. A refund would then be issued to the holder of the card for the deposit and the value that remained on the card six hours after the loss is reported, minus a HK$30 card cost and a HK$20 handling fee.
In contrast to On-Loan cards, Sold cards are sponsored and branded cards. They are souvenir cards that are frequently released by Octopus Cards Limited. The designs for these cards usually come from fictional characters in popular culture, or they are inspired by Chinese cultural events such as Chinese New Year
Chinese New Year
Chinese New Year – often called Chinese Lunar New Year although it actually is lunisolar – is the most important of the traditional Chinese holidays. It is an all East and South-East-Asia celebration...
. These cards are sold at a premium, have limited or no initial stored value, and cannot be refunded, but they can otherwise be used as ordinary cards. An example of the Sold card is the Mcmug
McMug
McMug is a cartoon pig who first appeared in Mingpao weekly magazine in 1988. The graphics are drawn by Hong Kong cartoonist Alice Mak with stories written by Brian Tse . Although McMug comics look somewhat childish, they cover more serious social topics, including death, poverty, unskilled...
and Mcdull
McDull
McDull is a cartoon pig character that was created in Hong Kong by Alice Mak and Brian Tse. Although McDull made his first appearances as a supporting character in the McMug comics, McDull has since become a central character in his own right, attracting a huge following in Hong Kong.-McDull's...
collection. It was launched at the end of January 2007 to coincide with the beginning of the Year of the Pig
Pig (zodiac)
The Pig , is the last of the 12 animals which appear in the Chinese zodiac. The Year of the Pig is associated with the earthly branch Hai .In Chinese culture, the pig is associated with fertility and virility...
, it features two differently designed versions of the card and is sold for HK$138 per set. Each set comes with an Adult Octopus card, with a pouch for the card, a matching strap and a Mcmug or Mcdull ornament. Octopus Cards Limited has launched new collections of these cards for such occasions as the Mid-Autumn Festival
Mid-Autumn Festival
The Mid-Autumn Festival , also known as the Moon Festival or Mooncake Festival or Zhongqiu Festival, is a popular lunar harvest festival celebrated by Chinese and Vietnamese people. A description of the festival first appeared in Rites of Zhou, a written collection of rituals of the Western Zhou...
, the passing of the year 2004, and the release of the movie DragonBlade
DragonBlade: The Legend of Lang
DragonBlade: The Legend of Lang is the first 3D-CGI Chinese animated feature film from Hong Kong and directed by Antony szeto. It was produced by "DCDC" and "China Film" company, and is also considered the first 3D rendered martial arts film....
. Sold Octopus cards may be purchased at selected MTR stations, and all 7-Eleven
7-Eleven
7-Eleven is part of an international chain of convenience stores, operating under Seven-Eleven Japan Co. Ltd, which in turn is owned by Seven & I Holdings Co...
stores.
The special-purpose card, Airport Express Tourist Octopus, was introduced by Octopus Cards Limited to target tourists in Hong Kong
Tourism in Hong Kong
The tourism industry has been an important part of the economy of Hong Kong since it shifted to a service sector model in the late 1980s and early 90s...
. Two versions of this card are offered, a HK$220 card with a free single ride on the Airport Express
Airport Express (MTR)
The Airport Express is one of the lines of the Mass Transit Railway serving Hong Kong. It links the principal urban areas of Hong Kong to Hong Kong International Airport and the associated AsiaWorld-Expo exhibition and convention centre....
, the Mass Transit Railway (MTR) train line that runs between the Hong Kong International Airport
Hong Kong International Airport
Hong Kong International Airport is the main airport in Hong Kong. It is colloquially known as Chek Lap Kok Airport , being built on the island of Chek Lap Kok by land reclamation, and also to distinguish it from its predecessor, the closed Kai Tak Airport.The airport opened for commercial...
and the urban areas of Hong Kong, and a HK$300 card with two free single rides included. The airport journeys are valid for 180 days from the date of purchase. Both versions allow three days of unlimited rides on the MTR and include a HK$50 refundable deposit. Usable value on these cards may be added if necessary. These tourist Octopus cards may be used only by tourists staying in Hong Kong for 14 or fewer days; users may be required to produce a passport showing their arrival date in Hong Kong. Airport Express Tourist Octopus is available for purchase at all MTR stations.
The other special-purpose card, the MTR Airport Staff Octopus, is available for the staff of Hong Kong International Airport and AsiaWorld-Expo
AsiaWorld-Expo
The AsiaWorld-Expo is one of the two major convention and exhibition facilities in Hong Kong along with Hong Kong Convention and Exhibition Centre. It was opened on 21 December 2005 by Donald Tsang, Chief Executive of Hong Kong, and it is operated by AsiaWorld-Expo Management Limited...
, a convention centre close to the airport, for commuting at a reduced fare between the airport and MTR stations via the Airport Express. Staff who apply for the card may use it for a discount of up to 64 percent for Airport Express single journey fares. The MTR Airport Staff Octopus is available upon application via the company for which that a staff member works.
Card usage
Photo booth
A photo booth is a vending machine or modern kiosk that contains an automated, usually coin-operated, camera and film processor. Today the vast majority of photo booths are digital. Traditionally photo booths contain a seat or bench designed to seat the one or two patrons being photographed...
s, parking meters, car parks
Parking lot
A parking lot , also known as car lot, is a cleared area that is intended for parking vehicles. Usually, the term refers to a dedicated area that has been provided with a durable or semi-durable surface....
and many other retails business where small payment are frequently made by customers. As of 21 November 2004, all parking meters in Hong Kong were converted. They no longer accept coins and Octopus became the only form of payment accepted.
Notable businesses that started accepting Octopus cards at the very early stage include PARKnSHOP
PARKnSHOP
PARKnSHOP is one of the two largest supermarket chains in Hong Kong, the other being Wellcome. PARKnSHOP operates more than 260 outlets in Hong Kong, Macau, and Mainland China....
, Wellcome
Wellcome
Wellcome is a supermarket chain owned by Jardine Matheson Holdings via its Dairy Farm subsidiary. The Wellcome supermarket chain is one of the two largest supermarket chains in Hong Kong, the other being PARKnSHOP. Wellcome also operates supermarkets in Taiwan under the Wellcome name...
, Watsons, 7-Eleven
7-Eleven
7-Eleven is part of an international chain of convenience stores, operating under Seven-Eleven Japan Co. Ltd, which in turn is owned by Seven & I Holdings Co...
, Starbucks
Starbucks
Starbucks Corporation is an international coffee and coffeehouse chain based in Seattle, Washington. Starbucks is the largest coffeehouse company in the world, with 17,009 stores in 55 countries, including over 11,000 in the United States, over 1,000 in Canada, over 700 in the United Kingdom, and...
, McDonald's
McDonald's
McDonald's Corporation is the world's largest chain of hamburger fast food restaurants, serving around 64 million customers daily in 119 countries. Headquartered in the United States, the company began in 1940 as a barbecue restaurant operated by the eponymous Richard and Maurice McDonald; in 1948...
, Circle K
Circle K
Circle K is an international chain of convenience stores, founded in 1951, in El Paso, Texas, United States. It is owned and operated by the Canadian-based Alimentation Couche-Tard.-Overview:...
, etc.
Octopus cards also double as access control cards in buildings and for school administrative functions. At certain office buildings, residential buildings, and schools, usage of an Octopus card is required for entry.
Payments
The MTR charge less for journeys made using an Octopus card instead of conventional single-journey tickets. For example, the adult fare of a single journey from Chai Wan to Tung Chung is HK$20.70 with an Octopus card, and HK$23.50 with a single journey ticket. Other public transport operators also offer intermittent discounts for using Octopus cards on higher fares and round-trip transits on select routes.
On 6 November 2005, Octopus Cards Limited launched Octopus Rewards, a program that allows cardholders to earn rewards at merchants that are partners in the program. Participating merchants provide consumers with tailor-made offers and privileges. The rewards that the program offers are in the form of points, or reward dollars, stored on the card. Once a card is registered for the program, the cardholder may accumulate reward points by making purchases at participating merchants, and payments may be made in the form of cash, credit cards, or Octopus cards themselves. The rate at which reward points are earned per dollar-amount purchase differs by the merchant at which that the purchases are made. At Wellcome
Wellcome
Wellcome is a supermarket chain owned by Jardine Matheson Holdings via its Dairy Farm subsidiary. The Wellcome supermarket chain is one of the two largest supermarket chains in Hong Kong, the other being PARKnSHOP. Wellcome also operates supermarkets in Taiwan under the Wellcome name...
, for example, one point is earned for every purchase of HK$200; and at Watsons, points are earned at a rate of 0.5 percent per dollar amount of a purchase. Once these reward dollars are accumulated, they may be redeemed as payment for purchases at partner merchants for at least HK$1 per reward dollar. To redeem the accumulated reward dollars, cardholders must use the entire value amount in whole, and may not elect to use it partially. If the purchase price is lower than the amount of reward dollars available, the amount difference remains stored on the card. Founding partners for the Octopus Rewards program include HSBC
HSBC
HSBC Holdings plc is a global banking and financial services company headquartered in Canary Wharf, London, United Kingdom. it is the world's second-largest banking and financial services group and second-largest public company according to a composite measure by Forbes magazine...
, UA Cinemas, Watsons, Wellcome, and McDonald's.
Enquiring balances, adding value and refunding
Monetary value can be added to the card through a number of ways. Add Value Machines, located at MTR stations, can be used to add more value to the cards. The machines accept cash, and selected machines are also able to accept Electronic Funds Transfer
Electronic funds transfer
Electronic funds transfer is the electronic exchange or transfer of money from one account to another, either within a single financial institution or across multiple institutions, through computer-based systems....
. Alternatively, value may be added with cash at authorised service providers such as PARKnSHOP, Wellcome, Watsons, 7-Eleven, Circle K, and Café de Coral
Café de Coral
Café de Coral is a fast food restaurant group which owns and operates fast food chains and restaurants including Café de Coral, The Spaghetti House, Manchu Wok, Oliver's Super Sandwiches, Ah Yee Leng Tong and others. Founded in 1968, the Café de Coral group opened its first Café de Coral...
, and also at customer service centres and ticketing offices at other transport stations.
An Octopus card may store a maximum value of HK$1,000, with an On-Loan card having an initial deposit value of HK$50 and a Sold card having no initial deposit value. Negative value is incurred on a card if it is used with insufficient funds—both types of cards may carry a maximum negative value of HK$35 before value needs to be added to them again for use. At the time, the maximum cost of a trip on any of the rail networks except the Airport Express and first class of the MTR East Rail line was HK$34.8, the cost of travelling between East Tsim Sha Tsui Station and Lo Wu Station; the current maximum cost is $47.5, the cost of travelling between Disneyland Resort Station and either Lo Wu Station or Lok Ma Chau Station.
The Octopus Automatic Add Value Service (AAVS) is another method by which cardholders may add value to their cards. This service allows for money to be automatically deducted from a credit card and added to an Octopus card when the value of the Octopus card is less than zero dollars. The credit card used must be one offered by one of 22 financial institutions that participate in AAVS. Participating banks include HSBC
HSBC
HSBC Holdings plc is a global banking and financial services company headquartered in Canary Wharf, London, United Kingdom. it is the world's second-largest banking and financial services group and second-largest public company according to a composite measure by Forbes magazine...
, Bank of China
Bank of China (Hong Kong)
Bank of China Limited is the second-largest commercial banking group in Hong Kong in terms of assets and customer deposits, with more than 300 branches in Hong Kong. It was established on 1 October 2001 from a merger of 12 subsidiaries and associates of the Bank of China in Hong Kong, and listed...
, and Hang Seng Bank
Hang Seng Bank
Hang Seng Bank Limited is the second largest bank in Hong Kong. It is a listed company but it is majority owned by the HSBC Group via The Hongkong and Shanghai Banking Corporation. Hang Seng is also one of the constituent shares of the Hang Seng Index...
. HK$250 is added to the card each time value is automatically added; six participating financial institutions offer an option of adding a value of HK$500 instead.
An Octopus card may be returned to any MTR Customer Service Centre for a refund of the remaining value stored on it. A handling fee may be charged for the refund; HK$7 for an anonymous On-Loan card that had been in use for fewer than three months, and HK$10 for a Personalised On-Loan card that was issued on or after 1 November 2004. A refund is immediately provided at the time an anonymous On Loan card is returned, unless it has more than HK$500 stored on it. A Personalised On-Loan card or an anonymous On-Loan card with more than HK$500 stored on it needs to be sent back to Octopus Cards Limited for refund processing, in which case, the refund for a Personalised On-Loan card would be available in eight days, and that of an anonymous On-Loan card would be available in five days. If a damaged card is returned for refund, a HK$30 levy would be charged to the cardholder.
Technology
The Octopus card uses the Sony
Sony
, commonly referred to as Sony, is a Japanese multinational conglomerate corporation headquartered in Minato, Tokyo, Japan and the world's fifth largest media conglomerate measured by revenues....
13.56 MHz FeliCa
FeliCa
FeliCa is a contactless RFID smart card system from Sony in Japan, primarily used in electronic money cards. The name stands for Felicity Card...
radio frequency identification (RFID) chip, and Hong Kong is the home of the world's first major public transport system using this technology. This is a "touch and go" system, so users need only hold the card in close proximity of the reader, and thus physical contact is not required. Data is transmitted at up to 212 kbit/s (the maximum speed for Sony FeliCa chips), compared to 9.6 kbit/s for other smart card systems like Mondex
Mondex
Mondex is a smart card electronic cash system which was originally developed by National Westminster Bank in the United Kingdom and subsequently sold to MasterCard International. Mondex launched in a number of markets during the 1990s, expanding from an original trial in Swindon, UK to Hong Kong,...
and Visa Cash
Visa Cash
Visa Cash is a smart card electronic cash system owned by VISA.Trialled in various locations Worldwide , the system works via a 'chip' embedded in a bank card, and looks similar to the so-called 'Chip and PIN' cards issued, among other countries, in Europe.The card is 'loaded' with cash via...
. The card has a storage capacity of 1 KB
Kilobyte
The kilobyte is a multiple of the unit byte for digital information. Although the prefix kilo- means 1000, the term kilobyte and symbol KB have historically been used to refer to either 1024 bytes or 1000 bytes, dependent upon context, in the fields of computer science and information...
to 64 KB compared to the 125 byte
Byte
The byte is a unit of digital information in computing and telecommunications that most commonly consists of eight bits. Historically, a byte was the number of bits used to encode a single character of text in a computer and for this reason it is the basic addressable element in many computer...
s provided by traditional magnetic stripe card.
Octopus uses a nonstandard system for RFID instead of the ISO/IEC 14443 standards, since there were no standards in the nascent industry during its development in 1997. The operating range of the reader/writer is between 30 and 100 mm (1.18 and 3.94 in) depending on the type of model being used.
Octopus is specifically designed so that card transactions are relayed for clearing on a store and forward
Store and forward
Store and forward is a telecommunications technique in which information is sent to an intermediate station where it is kept and sent at a later time to the final destination or to another intermediate station. The intermediate station, or node in a networking context, verifies the integrity of...
basis, without any requirement for reader units to have realtime
Real-time computing
In computer science, real-time computing , or reactive computing, is the study of hardware and software systems that are subject to a "real-time constraint"— e.g. operational deadlines from event to system response. Real-time programs must guarantee response within strict time constraints...
round-trip communications with a central database or computer. The stored data about the transaction may be transmitted by network after hours, or in the case of offline mobile readers may be retrieved by a hand held device, for example a Pocket PC
Pocket PC
A Pocket PC is also known by Microsoft as a 'Windows Mobile Classic device'. It is a hardware specification for a handheld-sized computer, personal digital assistant , that runs the Microsoft 'Windows Mobile Classic' operating system...
.
In practice, different data collection mechanisms are used by different transport operators, depending on the nature of their business. The MTR
MTR
Mass Transit Railway is the rapid transit railway system in Hong Kong. Originally opened in 1979, the system now includes 211.6 km of rail with 155 stations, including 86 railway stations and 69 light rail stops...
equips its stations with local area network
Local area network
A local area network is a computer network that interconnects computers in a limited area such as a home, school, computer laboratory, or office building...
s that connect the components that deal with Octopus cards—turnstile
Turnstile
A turnstile, also called a baffle gate, is a form of gate which allows one person to pass at a time. It can also be made so as to enforce one-way traffic of people, and in addition, it can restrict passage only to people who insert a coin, a ticket, a pass, or similar...
s, Add Value Machines, value-checking machines and customer service terminals. Transactions from these stations are relayed to the MTR's Kowloon Bay
Kowloon Bay (MTR)
Kowloon Bay is a station on the Hong Kong MTR Kwun Tong Line. The headquarters of the MTR Corporation Limited and the depot for the Kwun Tong Line are both located at this station. It is between Choi Hung station and Ngau Tau Kok station. The station was opened in 1979.Kowloon Bay is one of...
headquarters through a frame relay
Frame relay
Frame Relay is a standardized wide area network technology that specifies the physical and logical link layers of digital telecommunications channels using a packet switching methodology...
wide area network
Wide area network
A wide area network is a telecommunication network that covers a broad area . Business and government entities utilize WANs to relay data among employees, clients, buyers, and suppliers from various geographical locations...
, and hence onwards to the central clearing house system (CCHS) for clearing. Similar arrangements are in place for retailers such as 7-Eleven
7-Eleven
7-Eleven is part of an international chain of convenience stores, operating under Seven-Eleven Japan Co. Ltd, which in turn is owned by Seven & I Holdings Co...
. Handheld devices are used to scan offline mobile readers, including those installed on minibuses. Buses either use handheld devices or a wireless system, depending on operator.
Security
The Octopus card uses encryptionEncryption
In cryptography, encryption is the process of transforming information using an algorithm to make it unreadable to anyone except those possessing special knowledge, usually referred to as a key. The result of the process is encrypted information...
for all airborne communication and performs mutual authentication
Mutual authentication
Mutual authentication or two-way authentication refers to two parties authenticating each other suitably. In technology terms, it refers to a client or user authenticating themselves to a server and that server authenticating itself to the user in such a way that both parties are assured of the...
between the card and reader based on the ISO 9798-2 three-pass mutual authentication protocol. In other words, data communications are only established when the card and reader have mutually authenticated based on a shared secret
Shared secret
In cryptography, a shared secret is a piece of data, known only to the parties involved, in a secure communication. The shared secret can be a password, a passphrase, a big number or an array of randomly chosen bytes....
access key. This means that the security of the Octopus card system would be jeopardized should the access key be exposed. A stolen Octopus card reader could be used with stolen Octopus software, for example, to add value (up to HK$1,000) to any Octopus card without authorization. Nevertheless, as of 2003, the Octopus card and system have never been successfully hacked
Hacker (computer security)
In computer security and everyday language, a hacker is someone who breaks into computers and computer networks. Hackers may be motivated by a multitude of reasons, including profit, protest, or because of the challenge...
.
Octopus card reader includes a fail-safe
Fail-safe
A fail-safe or fail-secure device is one that, in the event of failure, responds in a way that will cause no harm, or at least a minimum of harm, to other devices or danger to personnel....
that prevents reader from initiating transaction when more than one card is being detected at the same time. On 11 February 2009, Sing Tao Daily
Sing Tao Daily
The Sing Tao Daily is Hong Kong's second largest Chinese language newspaper. It is owned by Sing Tao News Corporation Limited, of which Charles Ho Tsu Kwok is the chairman. Its English language sister paper is The Standard...
reported that the fail-safe has been abused for fare evasion
Fare evasion
Fare evasion, as distinct from fare avoidance, is the act of travelling on public transport in disregard of the law and/or regulation, having deliberately not purchased the required ticket to travel . It is a problem in many parts of the world, and revenue protection officers operate on many systems...
through the railway station turnstile. A large amount of dishonest passengers at Sheung Shui Station and Lo Wu Station were stacking up 4 or more cards before breaking through the turnstile, pretending their cards have been touched with the reader correctly but triggering the fail-safe deliberately to avoid card value deduction. Because of this, if they get caught by the station staff, they can make an excuse of a hardware malfunction and offer the Octopus card with an unsuccessful transaction.
Operator
The Octopus card system is owned and operated by Octopus Cards Limited, a wholly owned subsidiary of Octopus Holdings LimitedOctopus Holdings Limited
Octopus Holdings Limited is a holding company based in Hong Kong jointly owned by five major transport companies in the city. Its subsidiaries, which are all wholly owned, operate the various functions of the Octopus card in both its commercial and non-commercial usage...
. The company was founded as Creative Star Limited in 1994 to oversee the development and implementation of the Octopus card system, and was renamed as its current name of Octopus Cards Limited in 2002. Creative Star was formed as a joint-venture company by five major transit companies in Hong Kong—MTR Corporation
MTR Corporation
MTR Corporation Limited is a company listed on the Hong Kong Exchange and included in the Hang Seng Index. MTR owns and runs the Hong Kong MTR metro system, and is also a major property developer and landlord in Hong Kong...
, Kowloon-Canton Railway Corporation
Kowloon-Canton Railway Corporation
The Kowloon–Canton Railway Corporation was established in 1982 under the Kowloon–Canton Railway Corporation Ordinance for the purposes of operating the Kowloon–Canton Railway , and to construct and operate other new railways...
, Kowloon Motor Bus
Kowloon Motor Bus
The Kowloon Motor Bus Company Limited , a company of the Transport International Holdings Limited, is the largest franchised bus operators in Hong Kong, and one of the largest privately owned public bus operators in the world...
, Citybus
Citybus (Hong Kong)
Citybus Limited is one of the three major bus operators in Hong Kong. It provides both franchised and non-franchised bus service. The franchised route network serves mainly Hong Kong Island, cross-harbour routes , Ocean Park, North Lantau and Hong Kong International Airport...
, and Hongkong and Yaumati Ferry
Hongkong and Yaumati Ferry
The Hongkong and Yaumati Ferry Company Limited , HYF, is a ferry company founded in 1897 in Hong Kong. It is commonly known as Yaumati Ferry...
. In January 2001, the shares of Hongkong and Yaumati Ferry in the company was transferred to New World First Bus
New World First Bus
New World First Bus Services Limited , abbreviated as First Bus and "NWFB", is the third largest public bus operator in Hong Kong.NWFB was established in 1998, taking over China Motor Bus's franchise on 1 September 1998 to provide bus services on Hong Kong Island together with Citybus...
and New World First Ferry
New World First Ferry
New World First Ferry Services Limited is a ferry service company in Hong Kong. The company was established in November 1999, when it took over the 8 licensed ferry routes transferred from the Hongkong and Yaumati Ferry...
. In the same year, together with MTR Corporation, the company was transformed from its previous non-profit making status to a profit making enterprise.
Due to the expansion of the company's businesses, Octopus Holdings Limited was established in 2005 and Octopus Cards Limited was restructured as its subsidiary. The business of Octopus Cards Limited, being a payment business, is regulated by the Hong Kong Monetary Authority
Hong Kong Monetary Authority
The Hong Kong Monetary Authority or HKMA is Hong Kong's central banking institution . It is a government authority founded on 1 April 1993 via the consolidation of "Office of the Exchange Fund" and the "Office of the Commissioner of Banking"...
, while Octopus' non-payment businesses are not subjected to such regulation and are operated by other subsidiaries of Octopus Holdings Limited that are independent of Octopus Cards Limited. As of 2007, Octopus Holdings Limited was a joint-venture business owned by five transport companies in Hong Kong; 54.4% by the MTR Corporation, 22.1% by the Kowloon-Canton Railway Corporation, 12.4% by Kowloon Motor Bus, 5% by Citybus, and 3.1% by New World First Bus. Since the Government of Hong Kong
Government of Hong Kong
The Government of the Hong Kong Special Administrative Region of the People's Republic of China, commonly the Hong Kong Government, is led by the Chief Executive as Head of the Government, who is also the head of the Hong Kong SAR...
owns 76.54% of the MTR Corporation (as of 31 December 2005) and wholly owns the Kowloon-Canton Railway Corporation, it is the biggest effective shareholder of Octopus Holdings Limited, and thus also the biggest effective shareholder of Octopus Cards Limited.
Initially, Octopus Cards Limited, then known as Creative Star Limited, was restricted to having at most 15 percent of Octopus card transactions for non-transport transactions, as it operated under the Hong Kong government's Banking Ordinance
Banking Ordinance
Banking Ordinance are a set of laws passed by the Legislative Council of Hong Kong to tighten restrictions for opening up or licensing a bank. Prior to the 1964 re-regulations, the government had no way to control bank's monetary effect on the economy. It also had no way of protecting the people...
. On 20 April 2000, the Hong Kong Monetary Authority authorised the company for deposit-taking, which allowed for 50 percent of Octopus card transactions to be unrelated to transport. HK$416 million (US$53.3 million) is deposited in the Octopus system at any given time as of 2000.
Taxis
Although a popular form of transport, taxis in Hong KongTaxicabs of Hong Kong
Taxicabs of Hong Kong provide a taxi system. Most taxis are independently owned and operated, but some are owned by taxi companies, and the drivers are employees....
do not accept the Octopus card. On 27 June 2006, after 10 years of negotiations between Octopus Cards Limited and the taxi industry, the first trial of taxis equipped with Octopus card readers was launched in the New Territories
New Territories
New Territories is one of the three main regions of Hong Kong, alongside Hong Kong Island and the Kowloon Peninsula. It makes up 86.2% of Hong Kong's territory. Historically, it is the region described in The Convention for the Extension of Hong Kong Territory...
with taxis operated by the Yellow Taxi Group. But it was reported on 30 October that of the 20 taxis that participated in the trial, eight had dropped out. Part of the reason was technical—drivers must return to the office every day for accounting. The Octopus card company said it would be upgrading the system to allow automatic account updating in the future. Wong Yu-ting, managing director of the Yellow Taxi Group, also noted that they had been "trying to convince restaurants and retailers" to offer discounts to Octopus taxi passengers, but the Transport Department
Transport Department (Hong Kong)
Transport Department is responsible for transportation related policy in Hong Kong. The department reports to the Transport and Housing Bureau.The current Commissioner for Transport is Joseph Lai.-See also:* Transport in Hong Kong...
had been a major obstacle. The Transport Department is against this approach for legal reasons.
Alternative designs
Nokia
Nokia Corporation is a Finnish multinational communications corporation that is headquartered in Keilaniemi, Espoo, a city neighbouring Finland's capital Helsinki...
models 3310
Nokia 3310
The Nokia 3310 is a dual band GSM900/1800 mobile phone. Released in the fourth quarter of 2000, it replaced the popular Nokia 3210. This phone sold extremely well, being one of the most successful phones with 126 million units sold...
and 3330. As with the card itself, these products are used by waving them over a card reader. They may be reloaded with money value the same way as the card itself, including automatic reloading via the Automatic Add Value Service, with the exception that they cannot be reloaded at Add Value Machines due to their shapes. An Octopus watch or mobile phone cover may be stored with a maximum of HK$1,000, but do not have any initial stored value at the time of its purchase. It may have a maximum negative value of HK$35 as with an Octopus card. These products are not refundable for their costs, but the remaining value stored on them may be refunded if they are damaged, with the damaged product itself also returned to the customer.
In June 2007, a new set of limited edition products was announced, featuring Mini Octopus cards and Child Octopus Wristbands. The Mini Octopus cards, available in Adult and Elder editions, measure 4.7 cm by 3 cm (1.85 in by 1.18 in) and work as regular (anonymous) Adult and Elder, respectively, Octopus cards. The Child Octopus Wristbands are plastic wristbands with a watch-like round face and work as regular Child Octopus cards. The same value-adding abilities and limitations as the aforementioned watches and mobile phone apply.
Outside Hong Kong
Usage of the Octopus card was extended to the Chinese cities of ShenzhenShenzhen
Shenzhen is a major city in the south of Southern China's Guangdong Province, situated immediately north of Hong Kong. The area became China's first—and one of the most successful—Special Economic Zones...
and Macau
Macau
Macau , also spelled Macao , is, along with Hong Kong, one of the two special administrative regions of the People's Republic of China...
in 2006. In collaboration with China UnionPay
China UnionPay
China UnionPay , also known as UnionPay or by its abbreviation, CUP, is the only domestic bank card organization in the People's Republic of China . Founded in March 2002, China UnionPay is an association for China's banking card industry, operating under the approval of the People's Bank of China...
, Octopus Cards Limited introduced Octopus card usage to two Fairwood restaurants
Fairwood (restaurant)
Fairwood is a fast food chain offering Chinese and Western food at affordable prices. Founded in December 1972 in the Tsuen Wan district of Hong Kong, its current headquarters are located in North Point...
in Shenzhen in August 2006. In 2008, five Café de Coral
Café de Coral
Café de Coral is a fast food restaurant group which owns and operates fast food chains and restaurants including Café de Coral, The Spaghetti House, Manchu Wok, Oliver's Super Sandwiches, Ah Yee Leng Tong and others. Founded in 1968, the Café de Coral group opened its first Café de Coral...
locations in Shenzhen also started accepting Octopus. Value cannot be reloaded to Octopus cards in Shenzhen, but the Automatic Add Value Service is available to automatically deduct money value from a customer's credit card to reload an Octopus card. The two Fairwood restaurants in Shenzhen that were enabled for Octopus card payments are located at Luohu Commercial City and Shenzhen Railway Station
Shenzhen railway station
Shenzhen Railway Station or Shenzhen Luohu Railway Station is located across from Luo Hu Commercial City in the Luohu district of Shenzhen, Guangdong and is the southern terminus of the Guangshen Railway....
. Shenzhen became the first city outside Hong Kong in which Octopus cards may be accepted as payment. In Macau, the Octopus card was introduced in December 2006 when two Kentucky Fried Chicken restaurants in the territory adopted its usage as payment. Similar to its usage in Shenzhen, an Octopus card may not be reloaded in Macau, and the currency exchange rate between the Macanese pataca
Macanese pataca
The pataca is the currency of Macau. It is subdivided into 100 avos , with 10 avos called ho in Cantonese. The abbreviation MOP$ is commonly used....
and the Hong Kong dollar when using an Octopus card is MOP1:HKD1. The two Kentucky Fried Chicken restaurants in Macau that adopted the Octopus card for payment are located at the Rua Do Campo and the Sands Casino
Sands Macau
Sands Macao is a casino resort located in Macau Peninsula, Macau. It is owned and operated by the Las Vegas Sands Corporation, and was designed by Steelman Partners, LLP...
.
EPS add-value glitch
Electronic Payment Services
Electronic Payment Services , commonly known as EPS, is the largest electronic payment system in Hong Kong, Macau and Shenzhen starting from 1985. The service is provided by EPS Company Limited...
(EPS), in add-value service points would be suspended until further notice, and had started investigation of the system's mistake.
On 27 July 2007, a report was announced that the wrong transactions could be traced back to 2000, and a total of 3.7 million Hong Kong dollars was wrongly deducted from 15,270 cases. The company reported that there may be cases dating before 2000, because only transactions from the past seven years were kept. It stated that it would co-operate with EPS Company Limited, operator of Electronic Payment Services, and banks to contact customers involved and arrange a refund within ten weeks' time.
On 21 December 2007, the company announced to permanently cease all transactions completed using EPS because they cannot guarantee such events from happening again.
Privacy Abuse
On July 15, 2010, despite Octopus' claims to have never sold data, a former employee of the CIGNA insurance company claimed CIGNA purchased records for 2.4 million Octopus users. On July 20, Octopus acknowledged selling customers' personal details to Cigna and CPP, and started an internal review of their data practices. Octopus Holdings made 44 million Hong Kong dollars ($5.7M USD) over 4.5 years. Roderick Woo Bun, Hong Kong's Privacy Commissioner for Personal Data, gave radio interviews and called for transparent investigation, but his term expires at the end of July 2010. Allan Chiang Yam-wang was announced as the incoming Privacy Commissioner. This news was met with protests and international outrage, due to his prior history of privacy invasions involving cameras used to spy on his employees at the Post Office, and disclosing hundreds of job applicants' personal data to corporations. Outgoing Privacy Commissioner Woo pledged to finish a preliminary report on the Octopus privacy abuse before his term ends, and called for a new law making it a criminal offense for companies to sell personal data.See also
- Electronic moneyElectronic moneyElectronic money is money or scrip that is only exchanged electronically. Typically, this involves the use of computer networks, the internet and digital stored value systems...
- List of smart cards
- Shenzhen Tong
- Presto Card