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The on-line system will allow customers to pay for a variety of services including housing rents, insurance and business rates, to social services care packages and council invoices.

The system is said to be unique within the public sector and is one of the first to be fully automated, involving no manual processing of payments.

Under the new system, credit and debit card payments will be authorised and transacted within minutes, providing a quick, seamless service to the customer.

Geoff Homer, Project Leader, said: "Credit and debit cards are part of most peoples' lives now, and as a forward thinking authority, we want to move with the times.

"As the number of people who have access to personal computers grows, so does demand for this type of payment facility. People have come to expect e-services from their bank and local authorities need to be able to offer the same kind of business facilities."

A range of payment options will include 'PayPoint' stations, where bills can be paid in cash at a network of local shops and post offices, and telephone payments.

The internet payment system will be available to people who can access the service from personal PCs, libraries and internet cafes. A direct debit system will remain in place for council tax payers.