Mellon Bank Corp., an early adopter of electronic data interchange technology, plans to replace its aging mainframe-based EDI system with a client-server system from Premenos Technology Corp.

Mellon's electronic data interchange service is used by its corporate customers to automate the exchange of payments and remittance information with trading partners.

The bank's mainframe-based EDI software, written in 1989, has "outlived its usefulness," said Paul Whiteside, product manager for global cash management.

Terms of the deal were not disclosed.

Mellon officials said the new software will translate corporate EDI messages and convert them into automated clearing house payments, wire transfers, or paper checks.

The Premenos system will let corporate customers link with Mellon through direct dial-up connections, private networks, or over the Internet.

Bank officials said corporations in particular are interested in the Internet because of its low cost per transaction.

"Corporations are definitely gaining confidence in the Internet" for secure transmissions of payment requests and sensitive business information, said Randi Lichtenstein, senior product manager at Mellon.

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