Transport for London (TfL) is teaming with handset manufacturer Nokia and phone network O2 to develop a scheme that will enable customers to pay for tube journeys using mobile handsets.
According to a report by UK newspaper The Guardian, TfL is ready to launch trials of the service, which will see customers pay for journeys by swiping a mobile phone across Oyster card readers in London Underground stations.
Nokia's contactless system is expected to use a microchip inside the handset, which activates whenever it is passed over the Oyster card reader, says the report. The price of the journey would be deducted from a Oyster top-up account or added to the customer's monthly phone bill.
The scheme will be extended to bus journeys, trams and some overland journeys across the city, reports say.
TfL is thought to be hammering out the final details of the phone with O2 and Nokia before launching the trial.
Earlier this year TfL abandoned initial plans to add contactless payments functionality to its Oyster smart card after failing to agree terms with technical and financial partners.
Shortly afterwards Barclaycard won the exclusive rights to include Oyster functionality on its Visa cards. The bank launched a combined contactless Oyster travel and debit card, OnePulse, in the city in September.