Chinese smartphone maker Xiaomi is partnering with the country’s dominant card-payment processor to develop a mobile payment service for the domestic market.

The vendor didn’t say when it would launch the near field communication (NFC) payment service, but it is working with state-owned UnionPay to gain scale using the association’s wide footprint of credit and debit cardholders across China.

The two firms already collaborate to offer mobile payments via UnionPay’s QuickPass service, which allows users to make payments with their handsets at compatible point-of-sale terminals, China Daily reported.

Xiaomi will face an increasingly competitive field in China dominated by Alipay, the mobile payment arm of e-commerce giant Alibaba, and Tencent’s Tenpay.

Apple Pay launched in China in February after sealing a deal with UnionPay, and Samsung kicked off its payment service the next month, also in partnership with UnionPay. Google reportedly also plans to re-enter China next year with a revamped, China-specific version of its Google Play app store.

Huawei – the world’s third largest smartphone vendor – has joined the crowd with plans to offer a payment service for its smartphones and wearables. A month ago Huawei Pay was launched at a press conference in Shenzhen with Bank of China, its only partner to date, but other details were thin on the ground. The Chinese company’s rollout schedule is unclear.

Xiaomi is also partnering with Alipay to allow payments via wearable devices.

The once fast-rising Xiaomi has seen growth slow over the past two quarters, with sales falling slightly to 14.8 million smartphones in Q1 compared with 14.98 million a year ago, according to IHS Technology.

About 65 per cent of online payment transactions last year in China were made on mobile devices, according to a study by Alipay.