Commuters will no longer have to “go through hoops” to get compensation vouchers, but will have cash put into their accounts or onto travel cards.
Sky News reports that the pilot scheme is being introduced after it emerged that passengers could be missing out on up to £100m in compensation each year.
The announcement comes as it is revealed that New Year fare increases will be the smallest for almost six years.
There will be an average season ticket price rise of 1 per cent in January, following the announcement of last month’s inflation figures.
Railway minister Claire Perry said passengers would no longer be forced to fill in forms and wait for rail vouchers to arrive in the post.
Nine out of 10 rail customers fail to make regular claims for delay compensation because of the drawn-out process.
Under the new system, payments will be processed electronically with money sent straight to passengers’ bank accounts or travel cards.
The scheme is being piloted on c2c services between London and Essex starting next year.
Ms Perry told Sky News that c2c planned to refund people where trains are delayed by “even a couple of minutes”.
“They can do it because of smart ticketing technology that they are rolling out,” she said.
“I want that to be rolled out right across the rail industry.
“I want passengers to not have to go through hoops to get compensation.”
Meanwhile, commuters will face the smallest increase in rail fares for six years in January.
The annual rise for regulated tickets is based on July’s rate of Retail Price Index (RPI) inflation.
The 2016 increase will be the lowest since 2010, when fares decreased by 0.4 per cent.
But in the following five years annual rises have been between 2.5 per cent and 6 per cent.
A new report also says season tickets and other regulated fares have risen by almost three times faster than wages over the past five years.
The Action for Rail campaign group claims they have gone up by 25 per cent since 2010 – compared with a 9 per cent increase in average pay.
