The banking sector could not remain an exception when human life-style is heavily influenced by electronics. Banking, today, has become more complex with different products and services stemmed from reliance on automation and technological change. It has evolved from a manual-intensive industry into a highly automated and technology-dependent entity. Intense competition has forced banks to rethink the way they operate their business. They had to reinvent and improve their products and services to make them beneficial and cost-effective. Technology, in the form of electronic banking, has made it possible to find alternate banking practices, comparatively, at lower costs. There is a huge opportunity waiting to be discovered in the Indian E-Payment arena.

Banking in India has passed through several phases since formal banking activity has commenced. Of all, the current phase is the most interesting one where technology is playing a predominant role in deciding the acceptability or otherwise of a particular bank to the customer. Human life-style, having influenced by electronics, the banking sector could not remain an exception. Banking, today, has become more complex with different products and services which stems from reliance on automation and technological change and which has shaped itself from a manual-intensive industry into a highly automated and technology-dependent entity. Intense competition has forced banks to rethink the way they operate their business. They had to reinvent and improve their products and services to make them beneficial and cost-effective. Technology, in the form of electronic banking, has made it possible to find alternate banking practices, comparatively, at lower costs. More and more people are using electronic banking products and services. As a larger section of the banks' future customer base will be made up of computer-literate customers, the banks must be able to offer these customers, products and services that allow them to do their banking by electronic means. If they fail to do this they will, simply, not survive.

Over the centuries, the method of payment for goods and services has evolved—from barter agreements to shells, to coins, to paper-based money and finally to electronic payments. Today, electronic data and money are capable of moving around the world within seconds—very swiftly even without `swift'. The nature of payments and methods of payment continue to evolve, which are driven largely by innovation, customer convenience and other overall economic benefits are accrued form them. Efficiency in electronic payments brings about substantial benefits to the economy. Adoption of modern, global and efficient payment systems will benefit everyone—retail and wholesale customers, the retailers and wholesalers, the baking system and the government and the overall economy itself. Implementation of a good payment and settlement system can improve a country's credit-rating as it happened in the case of India with the implementation of Real Time Gross Settlement (RTGS) system for wholesale payments.

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