Merseytravel has launched a smartcard system to validate concessionary travel passes, which it hopes to grow to become the largest network of its type outside London.
The technology will be used on five of the city's bus routes and is currently restricted to the city centre services, accessed by around 300,000 holders of concessionary travel passes.
Neil Scales, chief executive of Merseytravel, said the scheme will be rolled out across other travel services once the public has become accustomed to the smartcard readers.
"Soon we will extend the technology to incorporate our ferry services and eventually we will have the biggest smartcard network outside London," he said.
The authority said it had been working on the technology for two years. But a spokesman said it had not been tested in the Merseyside region and was being rolled out on the basis that it had been successfully implemented elsewhere.
The Department of Transport recently said it is working with transport operators to introduce a national Oyster-style public transport card.
A spokesperson for the transport department said this is one of a number of measures being considered by the coalition government to modernise the country's transport system.