Abstract: Payment system is the mechanism that enables the smooth transfer of finances between buyers and sellers, or between banks. In the contemporary society, no monetary activities are possible without the transfer of paper currency. It can readily be said that payment system is one of the most important social infrastructures. Gone are the days when payments were used to be in cash only, slowly and gradually cheque came into picture and after that internet banking. After Internet banking mobile banking or mobile payment, in this way we can say money is transformed from paper to card to mobile and now to software. Now we hear the term contactless or proximity payment in which payment is done via NFC. Evolution of money brought the changes in security aspect also These technologies are getting wider day by day, NFC uses Secure Element for the transaction but now a days, payment can be done without involving Secure element (i.e.) only by the help of software that is build in the Operating system of the mobile phones.