Best AP Solution Highly Commended: Transport for London

Published: Jul 2019

Photo of Meg Coates with David Jones, HSBC who accepts the award on behalf of Transport for London.

Photo of Meg Coates with David Jones, HSBC who accepts the award on behalf of Transport for London.

Paul Mason

Head of Treasury & Group Insurance

Emma Thomas

Senior Manager Cash & Banking, Corporate Finance


Transport for London (TfL) is the local government organisation responsible for the transport system in Greater London.

in partnership with


Transport for London highlights the benefits for all as it takes another step towards an electronic, paperless environment

The challenge

In 2003 Transport for London (TfL) introduced its Oyster card, an electronic smartcard that revolutionised the way people pay for public transportation including the underground, bus, rail, boat and cable car network in the city and surrounding neighbourhoods.

There is a £5 deposit fee, which users can reclaim. There is also often cash left on dormant cards. For instance, visitors may not always use the full amount they loaded onto the card before leaving the city. By 2018, this left TfL with £320m waiting to be reclaimed.

This was due in part to people not inquiring to reclaim funds and in part to a long and cumbersome reimbursement process which involved requests by email or phone or by logging a case on TfL’s support portal.

The end result was that TfL put significant resources toward manually trying to return Oyster card balances to users. At peak times, two to three staff might spend three quarters of their day manually processing payments.

The large amount of cash they held in unreturned funds became a reputational challenge for the organisation, giving the appearance that they were not trying hard enough to get money back to users. Plus, this idle cash could not be used for any other purpose – making it inefficient from a liquidity and working capital perspective.

The solution

TfL wanted an innovative and automated solution that would clearly illustrate to the public that they were doing everything possible to return funds to end users. One of their banking partners, HSBC, had been working on a solution as part of its innovation initiative that seemed like a good fit. Using this as the basis, they devised a system whereby TfL gathers the initial information as it had before – confirming that the beneficiary is owed funds. TfL then sends daily files to the bank with beneficiaries’ email addresses and the amount owed. The bank invites the beneficiary via email to log on to a specially designed portal, they enter in their banking details, which the bank confirms, and the bank makes payments electronically on TfL’s behalf from a nominated account. Beneficiaries receive funds as soon as the payment is initiated.

Best practice and innovation

This is a first-of-its-kind, market leading solution.

HSBC had been working on a system to help customers alleviate the issues around manual payment processes – particularly paper-based processes. The intent was not only to save time and money, but also to minimise the high risk of fraud associated with issuing cheques.

While TfL’s challenges were different since they were already attempting to make payments electronically, the solution was easily tailored to their needs.

By being a pilot case for this solution, TfL is helping illustrate the benefits of this step forward toward an electronic, paperless environment. Plus, the solution in general empowers beneficiaries by giving them the ability to choose which currency and country they want to receive payment.

Key benefits

The new process has successfully:

  • Saved two to three hours a day by eliminating refund processes from day-to-day workload.

  • Reduced the turnaround time of refunds from five days to 48 hours and sometimes as little as a day.

  • Minimised the number of errors and payment failures.

  • Streamlined processes, creating time savings that allows staff to be deployed in other areas.

  • Reduced processing costs for relatively low-value payments.

By the end of 2018, the process was making repayments to Oyster card users across 66 currencies.

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