While seven per cent of people underpay and could be fined, 13 per cent are paying too much, the BBC reported.
The Office of Rail and Road (ORR) wants train companies to refund passengers who accidentally buy tickets that are too expensive for their journey.
Train operators said that vending machines were designed for simple ticket requirements.
They say plans to simplify fares will help them to give clearer information on ticket machines.
"We are calling on train companies to commit to refund anyone who finds that they could have bought a cheaper ticket for the same journey," he added.
Rail operators C2C and Scotrail already have a price guarantee in place for when passengers overpay.
Earlier this month, the Rail Delivery Group (RDG), which represents train operators, announced a trial scheme to simplify fares.
It said the 16 million fares on offer were "baffling" for passengers.
"To quickly benefit passengers, the Rail Delivery Group must set out what improvements to ticket machines will be made in the short term," said Larkinson.
Paul Plummer, chief executive of the RDG, said that operators were aware that there was a problem with machines, and that they had formulated a 10-point plan to improve them.
Yet he pointed out the machines were designed as "queue- busters" for passengers with relatively simple requirements, but "expectations [of passengers] had evolved".
The RDG also added: "Complex, decades-old government rail fare regulations make it more difficult for train companies to offer the right, simple options on ticket machines.
"Simplifying the number and types of fares in the system will let train companies provide customers with clear information and help them to make better informed choices," they added.
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