Google unveiled its India-specific mobile payment application Tez, joining the growing list of companies bidding to take a slice of the country’s potentially lucrative digital finance sector.

In a widely anticipated move, Google moved away from the Android Pay service seen in other markets and instead built an application based on government standard interface, the UPI. This means its money transfer service will be compatible with a wide range of payment services already available in India.

Tez offers payment for goods and person-to-person digital cash transfer, and has been developed for use on both Android and iOS devices.

Google has also signed agreements with authority the National Payments Corporation of India and three of the country’s leading banks – Axis, HDFC, ICICI – to increase the scope of the service. A deal with the State Bank of India is set to be added “soon”.

In its company blog, Google said it expected to unveil credit services and increased wallet functionality in the coming “weeks and months”.

“To make digital payments truly work for India, we need a product that can compete with cash. It needs to be simple, affordable, and work everywhere and for everyone,” Google VP for its Next Billion Users Team, Caesar Sengupta, said.

“This [Tez] is just one step in a long and important journey towards enabling a cashless India — a crucial component of a Digital India,” he added.

Selected handsets from Lava, Micromax, Nokia and Panasonic will be sold with the application already installed.

Tough competition
The launch of Tez sees Google compete with payment services already available from mobile operators, traditional finance providers, e-Commerce companies and mobile wallet specialist firms including Paytm – which so far has 200 million users.

Additionally, chat apps with huge user-bases are at various stages of entering the fray. Hike – which boasts 100 million subscribers – launched its transaction facility in June and WhatsApp is also said to be preparing its service, aimed at its base of 200 million.

The rush to grab a share of the payments market comes amid government initiatives to reduce the use of cash in the country under the broad umbrella of Digital India.