In 1975 Singapore introduced the first road pricing system in the world around the central part of the city, an area of 7.2km2. Due to relatively high charges the traffic was immediately reduced with 44 per cent. In the mid nineties the system was extended to cover 3 approach roads.
The first system was based on the driver buying a license. The license was mounted on the car where it had to be visible to the police. With many different types of licenses depending on time, vehicle type and stretch, the system became very difficult to enforce as it was extended to also cover the approach roads. In 1998, Singapore, therefore, changed to a system with radios (tags) and payment each time a driver entered the area.
The change from the first system (prepayment for a year) to the second system (payment each time a driver entered the area) had a significant traffic reduction effect. The traffic was reduced with 15 per cent and the average speed on the approach roads increased from 35 to 55km/h.