Etailing giant Amazon is reportedly close to launching an online payment system to rival Google Checkout and eBay’s PayPal.

TechCrunch reports that the move would extend the etailer’s existing Amazon Payments service, which is used by third party sellers on its site.

Like Google Checkout, it will apparently redirect customers to Amazon’s servers to complete payments, as well as managing user-to-user transactions.

Amazon is yet to comment, but if true, the move would add to an already feisty battle between Checkout and PayPal.

It will hope its brand recognition and existing relationship with other etailers will allow it to make a sizeable dent in PayPal’s lead.

According to TechCrunch, the company has been testing the service “for a few weeks”, and could launch it within days. 

Meanwhile, PayPal has moved into credit financing with the launch of a service called PayPal Pay Later.

Developed with General Electric’s GE Money Bank, the service allows online retailers to offer credit accounts to customers, with interest being shared between PayPal and GE.

A spokesperson for the company told Reuters that its research had indicated that over half of PayPal users would be more likely buy things if they could defer payments.

Merchants aren’t charged an extra fee for the service.