Another way you can do it is to keep the Picasa window open, insert your banner to your shop. If if need to be cropped some more to fit then go back to Picasa and do that. The former way seems like it would be the easiest to me but there are your options.
Good Luck
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This is something that I have always wanted to do. However I did not have the fancy expensive programs to do it in. And with this economy, I would rather try to do it on a free program. If you have read my blog for anytime you know that I have an Etsy store. I wanted to make a banner that used my products and looked nice and sharp. Here is how I did mine.
First download Picasa. It is free and it is here.
Here is the banner I made.

First step is to select the photos you want on your banner. When they are all collected in the selection tray (you can just click on them and they should show up there), click the collage button in the tool bar at the bottom to your right. Make sure to select the ‘Picture Pile’ type of collage so you can drag the photos into just the right order. Don't worry about them being the same size as you will be cropping them. Just make sure that you have them how you want them. Another cool thing with Picasa is that if you wanted one to be crooked you could do that.

When you finish, hit create collage and close your collage. You have a new picture. Next is to crop it, using the ‘manual’ size setting, into a banner, short and wide. Hit Apply when you have it cropped how you want. Now you can add writing if you would like also.

Here it is after cropping and adding some writing. Last step is to go under File and Export to folder. This will make a Folder in My Pictures just for your banner. When you export it make sure to size it to 760 for Etsy.

Your done! Aren't you proud of yourself?