Starting October 1, motorists in Singapore will have a five-day grace period to pay missed Electronic Road Pricing (ERP) charges without incurring a S$10 administrative fee. The Land Transport Authority (LTA) announced this new initiative on Friday, August 30, aiming to make it easier for drivers to avoid additional costs while enhancing administrative efficiency.
Current Penalty System and the New Waiver
At present, motorists who miss an ERP payment receive a notification letter within a few days, instructing them to pay the missed charge plus a S$10 (approximately US$7.70) admin fee. This fee has been in place since the ERP system's inception in 1998. However, with the new policy effective from October 1, drivers will instead receive an SMS notification from LTA, giving them a five-day window to settle their ERP arrears without the extra charge.
If payment is not made within this grace period, LTA will issue a formal letter, and the motorist will then be required to pay the ERP charge along with the S$10 admin fee. Failing to make this payment will result in a further fine of S$70. To ensure motorists receive these SMS notifications, they should keep their mobile number updated on the Singpass website.
Why Is the Admin Fee Being Waived?
Transport Minister Chee Hong Tat highlighted that waiving the S$10 fee benefits all parties involved. He described it as a “win-win” scenario: “For LTA, we save the trouble and improve our productivity by not having to process and send out letters. Of course, motorists will welcome the waiver of this admin fee.”
LTA sends approximately 500,000 such letters each year, collecting around S$5 million in administrative fees. Mr. Chee noted that while the authority would lose this revenue, it is a preferable outcome: “We’d rather not incur the cost of sending out these letters in the first place. Instead, we can focus our resources, time, and manpower on more important tasks.”
The Impact of ERP 2.0 on Fee Collection
The fee waiver coincides with the rollout of the ERP 2.0 system, which will offer a more efficient way for motorists to handle outstanding payments. The new system includes an on-board unit (OBU) linked to a back-end system, allowing drivers to view and pay any ERP arrears directly through the OBU display.
Mr. Chee explained, “With ERP 2.0, there’s no longer a need to send letters for missed payments, and thus no need to charge the S$10 admin fee. It’s more convenient for motorists to manage their payments through the new OBU system.”
The ERP 2.0 system, featuring this new payment capability, is set to roll out starting in mid-2025, with further details to be shared closer to the launch.
Immediate Implementation and Future Outlook
Despite only 10% of vehicles in Singapore (about 100,000) currently being equipped with ERP 2.0, the interim solution will still apply to all vehicles from October 1. Mr. Chee stated, “There’s no need to wait for full ERP 2.0 installation. We can begin implementing this change now.” Full installation of ERP 2.0 across all vehicles is on track for completion by 2026.
The introduction of the five-day grace period for missed ERP charges aligns with LTA’s aim to streamline operations and reduce costs while providing a more customer-friendly approach for motorists. With the upcoming ERP 2.0 system promising even greater convenience and efficiency, this interim measure represents a significant step towards enhancing the overall experience of Singapore’s road users.
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