Transport for London (TfL) has announced that London buses will no longer accept cash payments from summer 2014.
TfL reported that cash payments make up just 1% of journeys, while contactless bank card payments have continued to grow steadily since their introduction in December 2012.
Leon Daniels, of TfL said: "The decision to stop accepting cash fares on London buses reflects the changing way that people pay for goods and services in our city, including journeys on the bus network.
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"We are introducing a range of measures, including a new "one more journey" feature on Oyster cards, which will ensure that people can still make a journey and then top up their card when they don’t have a full fare."
This feature mimics similar "one more ride" functions already used on other transit card schemes, such as on Toronto’s Presto card system.
Daniels concluded saying: "Paying with Oyster or a contactless payment card is not only the cheapest option, but also spreads up boarding times at bus stops and reduces delays.
"By removing this option we will generate significant savings which, like all of our income, will be reinvested in improvements to the transport network".
Payments in cash on London buses cost £24m ($39m) a year and a public consultation into stopping cash payments on buses received 37,000 responses.
TfL said a third of respondents agreed with plans to stop cash payments, while three quarters of respondents said they already do not use cash on the buses.
It is not clear yet in which date payments in cash will not be allowed anymore on London buses.
In order to help the transition TfL is working on two other measures beyond the "one more journey" feature.
TfL will roll out more Oyster ticket shops (especially in outer London) and will train an extra 24,500 staff to "ensure a consistent approach is taken when dealing with vulnerable passengers".