Southern has confirmed it will be adopting the Oyster Pay-As-You Go system at stations across the overground train network which it operates.
The move is a victory for thousands of commuters who will now be able to make significant savings as they travel from south-west London to other parts of the capital.
The stations which will be upgraded with Oyster equipment include Streatham Hill, Tulse Hill, Streatham, West Norwood, Gipsy Hill, Crystal Palace and Streatham Common.
Trains from these stations, and many other surburban stops transport thousands of workers to mainline destinations including Victoria, Charing Cross, Clapham Junction and London Bridge every day.
A spokesman for the train company said: "Southern will be working with Transport for London to introduce Oyster Pay-As-You-Go.
"Southern is acutely aware of the benefits Oyster will bring to its passengers and is eager to deliver those benefits during the current franchise."
The news is also a success for our Fare's Fair campaign, which pressed for the card payment system used by millions of Londoners to be rolled out to more overground stops.
Southern's managing director Chris Burchell said: "We want to play our full part in making sure Londoners continue to get a more integrated transport network.
"There are still a number of outstanding issues that need to be discussed with TfL, but we do not believe these will prevent us making PAYG a reality on our network.
"We look forward to discussions with TfL on how we can make this happen as soon as possible for our passengers."
TfL had put up £20million of taxpayers' money for the company to pay for Oyster equipment, such as the barriers and swipe machines to be installed at stations.
But Southern held out until the deadline given to it by London Mayor Ken Livingstone, as it hoped for more cash to pay for the works.
Streatham MP Keith Hill said: "I would like to congratulate Southern whole-heartedly for leading the way among railway companies in working with Transport for London to find a way of allowing the use of Oyster pay-as-you-go at its stations.
"I know that as a regular Oyster card user myself, the adoption of pay-as-you-go will make using the rail network in South London so much more convenient and equitable."
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