The scheme, which is being masterminded by card company Visa, allows passengers to swipe their contactless debit or credit card against a reader in the rear of the cab.
The system only allows the contactless payment method for fares up to £15, and is only for the contactless Visa cards at the moment – not Oyster cards themselves.
Passengers will also be able to use the more conventional chip and pin method to pay for their journeys, and the new terminal means they will be able to do so in the back of the taxi without handing their card to the driver. The system will be trialled on 80 cabs.
Transport for London is supporting the scheme, and a spokeswoman said it was welcome as it fits in with their safer travel scheme. "We welcome it as it will mean people won't have to stop off at cashpoints on their way home," she said.
Kulveer Ranger, the Mayor's transport adviser, said: "It's fantastic to see our iconic black cabs leading the way with the latest in 21st century technology.
"More and more passengers are keen to pay for taxi journeys by card, and this makes the whole experience more efficient.
"I am delighted that London's taxis are leading the way with this new type of technology, making taxi payment less taxing and allowing passengers to relax and enjoy the banter with our world-famous London cabbies."