I have a string coming from a table like \"can no pay{1},as your payment{2}due on {3}\". I want to replace {1} with some value , {2} with some value and {3} with some value
Although it is not one call, you can nest the replace() calls:
replace()
SET mycol = replace( replace(mycol, '{1}', 'myoneval'), '{2}', mytwoval)