Citibank in new prepaid card mechanism for Panama City public transport

Arias, Fábrega & Fábrega represented Citibank, N.A. (Panama Branch) in drafting and negotiating a Trust Agreement for Sociedad Nacional de Procesamiento de Datos, S.A. (Sonda), a Chilean company with ample experience in public transportation prepaid card systems.

The trust agreement, with Citibank as trustee, Sonda as settlor and Transporte Masivo de Panamá, S.A. (TMP) as beneficiary, establishes Sonda as administrator of the financial system of the Panama City Public Transportation System, also known as Metro Bus. This enables Sonda to collect and administer all electronic card payments used on Metro Bus.

Sonda will implement a prepaid card system for the Metro Bus systems that will replace cash in all public transportation buses. This is part of a broader strategy by the Government to modernize Panama City's public transportation system, which includes replacing the existing bus fleet with new Volvo buses to be provided by TMP.  

In the fast-changing landscape of Panama City, the replacement of the old and deteriorated red buses known as "Diablos Rojos" by the brand new Volvo buses acquired by TMP ranks very high as one of the most significant signs of progress and modernization of the country. The implementation by Sonda, with the assistance of Citibank, N.A. Panama Branch as trustee of the newly created trust, of the prepaid card system for the Metro Bus is an absolutely crucial step towards the successful implementation of the new Metro Bus System.