Train companies in London will have to invest in IT systems to support Oyster smartcard payments as London goes through "Oysterisation", according to London mayor Boris Johnson.
Radio frequency identification (RFID) style technology is behind the Oyster smartcards, which were launched in July 2003.
The card, which removes the need for cash when buying tickets, was the first of its kind in the UK and aimed to provide faster passage for the six million users of London's transport network.
But unless travellers have pre-paid tickets, they cannot use Oyster cards on trains. This means thousands of people could not benefit from the convenience of the card.
Following the announcement hundreds of thousands of passengers who travel on National Rail services within Greater London will be able to use Oyster pay as you go from 2 January 2010, said Transport for London (TfL).
"The extension of the ticketing system will cover all commuter rail routes within Greater London, and will particularly benefit commuters living across south and northeast London, where Oyster pay as you go is not currently accepted on the vast majority of rail services," said TfL.