Abstract— The Financial System of a country is an important tool for economic development of country. In recent years Indian financial system have been undergoing from modernization phase and implementing many innovation ideas in the system. This study is focused on only payment and settlement system and it is based on secondary data sources. Data consist in it has been analyzed by the simple  tatistical tools. This study consists ICT based payment system and services provided by RBI and banking institutions in India as well level of transaction volume, value as well as include threats of e-payment system as suggest applicable measures to enhance payment system.