diff --git a/src/libs/actions/IOU.ts b/src/libs/actions/IOU.ts
index 0f974566a98b..8b68df3b3d89 100644
--- a/src/libs/actions/IOU.ts
+++ b/src/libs/actions/IOU.ts
@@ -312,7 +312,13 @@ function getReportPreviewAction(chatReportID: string, iouReportID: string): Onyx
  * @param isFromGlobalCreate
  * @param iouRequestType one of manual/scan/distance
  */
-function initMoneyRequest(reportID: string, policy: OnyxEntry<OnyxTypes.Policy>, isFromGlobalCreate: boolean, iouRequestType: IOURequestType = CONST.IOU.REQUEST_TYPE.MANUAL) {
+function initMoneyRequest(
+    reportID: string,
+    policy: OnyxEntry<OnyxTypes.Policy>,
+    isFromGlobalCreate: boolean,
+    currentIouRequestType: IOURequestType | undefined,
+    newIouRequestType: IOURequestType,
+) {
     // Generate a brand new transactionID
     const newTransactionID = CONST.IOU.OPTIMISTIC_TRANSACTION_ID;
     const currency = policy?.outputCurrency ?? currentUserPersonalDetails?.localCurrencyCode ?? CONST.CURRENCY.USD;
@@ -320,11 +326,9 @@ function initMoneyRequest(reportID: string, policy: OnyxEntry<OnyxTypes.Policy>,
     // eslint-disable-next-line @typescript-eslint/prefer-nullish-coalescing
     const created = currentDate || format(new Date(), 'yyyy-MM-dd');
 
-    const currentTransaction = allTransactionDrafts?.[`${ONYXKEYS.COLLECTION.TRANSACTION_DRAFT}${newTransactionID}`];
-
     // in case we have to re-init money request, but the IOU request type is the same with the old draft transaction,
     // we should keep most of the existing data by using the ONYX MERGE operation
-    if (currentTransaction?.iouRequestType === iouRequestType) {
+    if (currentIouRequestType === newIouRequestType) {
         // so, we just need to update the reportID, isFromGlobalCreate, created, currency
         Onyx.merge(`${ONYXKEYS.COLLECTION.TRANSACTION_DRAFT}${newTransactionID}`, {
             reportID,
@@ -339,7 +343,7 @@ function initMoneyRequest(reportID: string, policy: OnyxEntry<OnyxTypes.Policy>,
     const comment: Comment = {};
 
     // Add initial empty waypoints when starting a distance expense
-    if (iouRequestType === CONST.IOU.REQUEST_TYPE.DISTANCE) {
+    if (newIouRequestType === CONST.IOU.REQUEST_TYPE.DISTANCE) {
         comment.waypoints = {
             waypoint0: {keyForList: 'start_waypoint'},
             waypoint1: {keyForList: 'stop_waypoint'},
@@ -357,7 +361,7 @@ function initMoneyRequest(reportID: string, policy: OnyxEntry<OnyxTypes.Policy>,
         comment,
         created,
         currency,
-        iouRequestType,
+        iouRequestType: newIouRequestType,
         reportID,
         transactionID: newTransactionID,
         isFromGlobalCreate,
diff --git a/src/pages/iou/request/IOURequestStartPage.tsx b/src/pages/iou/request/IOURequestStartPage.tsx
index 09fe67ab882f..0d124c783947 100644
--- a/src/pages/iou/request/IOURequestStartPage.tsx
+++ b/src/pages/iou/request/IOURequestStartPage.tsx
@@ -1,4 +1,4 @@
-import React, {useCallback, useEffect, useMemo, useRef, useState} from 'react';
+import React, {useCallback, useEffect, useMemo, useState} from 'react';
 import {View} from 'react-native';
 import {useOnyx} from 'react-native-onyx';
 import DragAndDropProvider from '@components/DragAndDrop/Provider';
@@ -15,7 +15,6 @@ import * as DeviceCapabilities from '@libs/DeviceCapabilities';
 import Navigation from '@libs/Navigation/Navigation';
 import OnyxTabNavigator, {TabScreenWithFocusTrapWrapper, TopTab} from '@libs/Navigation/OnyxTabNavigator';
 import * as ReportUtils from '@libs/ReportUtils';
-import * as TransactionUtils from '@libs/TransactionUtils';
 import AccessOrNotFoundWrapper from '@pages/workspace/AccessOrNotFoundWrapper';
 import type {IOURequestType} from '@userActions/IOU';
 import * as IOU from '@userActions/IOU';
@@ -23,6 +22,7 @@ import CONST from '@src/CONST';
 import ONYXKEYS from '@src/ONYXKEYS';
 import type SCREENS from '@src/SCREENS';
 import {isEmptyObject} from '@src/types/utils/EmptyObject';
+import isLoadingOnyxValue from '@src/types/utils/isLoadingOnyxValue';
 import IOURequestStepAmount from './step/IOURequestStepAmount';
 import IOURequestStepDistance from './step/IOURequestStepDistance';
 import IOURequestStepScan from './step/IOURequestStepScan';
@@ -41,7 +41,8 @@ function IOURequestStartPage({
     const [isDraggingOver, setIsDraggingOver] = useState(false);
     const [report] = useOnyx(`${ONYXKEYS.COLLECTION.REPORT}${reportID}`);
     const policy = usePolicy(report?.policyID);
-    const [selectedTab] = useOnyx(`${ONYXKEYS.COLLECTION.SELECTED_TAB}${CONST.TAB.IOU_REQUEST_TYPE}`);
+    const [selectedTab = CONST.TAB_REQUEST.SCAN, selectedTabResult] = useOnyx(`${ONYXKEYS.COLLECTION.SELECTED_TAB}${CONST.TAB.IOU_REQUEST_TYPE}`);
+    const isLoadingSelectedTab = isLoadingOnyxValue(selectedTabResult);
     // eslint-disable-next-line  @typescript-eslint/prefer-nullish-coalescing
     const [transaction] = useOnyx(`${ONYXKEYS.COLLECTION.TRANSACTION_DRAFT}${route?.params.transactionID || -1}`);
     const [allPolicies] = useOnyx(ONYXKEYS.COLLECTION.POLICY);
@@ -57,16 +58,16 @@ function IOURequestStartPage({
         [CONST.IOU.TYPE.INVOICE]: translate('workspace.invoices.sendInvoice'),
         [CONST.IOU.TYPE.CREATE]: translate('iou.createExpense'),
     };
-    const transactionRequestType = useRef(TransactionUtils.getRequestType(transaction));
+    const transactionRequestType = useMemo(() => transaction?.iouRequestType ?? selectedTab, [transaction?.iouRequestType, selectedTab]);
     const isFromGlobalCreate = isEmptyObject(report?.reportID);
 
     // Clear out the temporary expense if the reportID in the URL has changed from the transaction's reportID
     useEffect(() => {
-        if (transaction?.reportID === reportID) {
+        if (transaction?.reportID === reportID || isLoadingSelectedTab) {
             return;
         }
-        IOU.initMoneyRequest(reportID, policy, isFromGlobalCreate, transactionRequestType.current);
-    }, [transaction, policy, reportID, iouType, isFromGlobalCreate]);
+        IOU.initMoneyRequest(reportID, policy, isFromGlobalCreate, transaction?.iouRequestType, transactionRequestType);
+    }, [transaction, policy, reportID, iouType, isFromGlobalCreate, transactionRequestType, isLoadingSelectedTab]);
 
     const isExpenseChat = ReportUtils.isPolicyExpenseChat(report);
     const isExpenseReport = ReportUtils.isExpenseReport(report);
@@ -82,7 +83,7 @@ function IOURequestStartPage({
             if (transaction?.iouRequestType === newIOUType) {
                 return;
             }
-            IOU.initMoneyRequest(reportID, policy, isFromGlobalCreate, newIOUType);
+            IOU.initMoneyRequest(reportID, policy, isFromGlobalCreate, transaction?.iouRequestType, newIOUType);
         },
         [policy, reportID, isFromGlobalCreate, transaction],
     );