GIRO was set up in 1984 as an electronic direct debit mechanism used by billing organisations (BOs) as a low cost means to collect payments. GIRO is a tripartite mechanism between billing organisations, customers and the bank. The authorisation for direct debit is a contractual relationship between a consumer and a BO; banks are the intermediaries in this tripartite relationship, and help to effect authorised GIRO deductions.

Today, GIRO is widely used for consumers to pay bills to government agencies and private sector BOs. GIRO is especially useful for payments which are regular in nature and of a fixed quantum. In the public sector, some fees such as MOM's foreign maid levy and CAAS' season parking, GIRO have been made the only means of payment. For many other public sector fees and charges, such as school and miscellaneous fees, rentals, seasons parking and personal income tax, a substantial proportion of the payments are also made through GIRO.