Google releases Android Pay Alternative in India

Alphabet (NASDAQ: GOOG) took a lot of people by surprise by offering a completely different payment app in lieu of Android Pay in India. Indian Android users will have to pay with something called Tez instead.

Tez is a peer to peer payment app similar to PayPal’s (NASDAQ: PYPL) Venmo. Tez works with the Unified Payments Interface (UPI) payment system operated by the National Payments Corporation of India. Currently, all major banks that work with UPI support Tez, including all of India’s major banks such as Axis, HDFC Bank, ICICI and the State Bank of India. If it works as advertised users will be able to pay with funds from their bank accounts.

UPI is a digital and mobile payment system sanctioned by the Reserve Bank of India, that nation’s central bank. It uses a unique ID called a Virtual Payment Address that’s similar to a token. Tez is a payment app designed to facilitate UPI payment. Like Apple Pay, Tez is supposedly heavily encrypted with something called Tez Shield.

Interestingly enough, Tez can be used on either iPhone or Android devices. It is available in both the App Store and Google Play. It looks as if Tez is a model for a national digital payment system operated by a central bank. If Tez works in India, Alphabet (NASDAQ: GOOGL) may roll it in many different nations.

Tez and Payment apps as Digital Currency

It is no coincidence that Tez is appearing in India less than a year after Prime Minister Narenda Modi declared most of the cash in the country worthless. Tez might be part of a plan to force Indians to use digital payments and the modern banking system.

Currently, Tez is only available in India and can be used at Domino’s TV, DishTV (the satellite service) PVR Cinemas, RedBus and Jet Airlines. Persons will be able to instantly send cash to other Tez users via a bank account or phone number with Tez Cash Mode.

Unlike Android Pay, Tez uses Audio QR (QR) code to communicate with cash registers. One reason why Alphabet is using Tez is India is that the Near Field Communication (NFC) system that Android Pay operates through is not available in that country.

Is Tez Alphabet’s Answer to Venmo?

Tez sounds like an answer to Venmo, an interesting question will be if Tez gets launched in the United States. Many large U.S. retailers including Walmart have refused to accept NFC payment apps such as Apple Pay and Android Pay.

A strong possibility is that Tez or something like it might be rolled out in the U.S. for use at retailers like Walmart that take QR code payment apps but not NFC solutions. It looks as if Alphabet wants to compete directly with Venmo and PayPal.

Tez users will be able to send up to 9,000 rupees ($138.66), The Hindustan Times reported. An interesting feature is a lottery that lets you win up to 1,000 rupees a week with Tez Scratchcards. Tez also offers a rewards-card program, so it might be a model for an improved or next generation for the United States.

It looks as if Alphabet is a serious competitor in the payments sphere. One has to wonder if the company formerly known as Google will launch its’ own cryptocurrency next.