Internet search engine company Google has launched its payment service, Google Checkout, in the UK, in a significant UK investment designed to enhance its capabilities in this country.

Checkout is launched against the existing mainstream card processing services used by a lot of the online merchants and auction site eBay’s Paypal service and represents a significant UK investment for the company.

It has been rolled out to top up the money made by the sale of online adverts, by offering its advertisers cheap order processing.

“The starting point is our core products,” said Google’s UK consumer marketing chief, Obi Felton. “Checkout is the conclusion of the transaction cycle of consumers finding retailers through searches and advertising.”

Despite industry talk that Checkout has been designed to “kill off” eBay’s Paypal system, Google executives were keen to discount this theory. “If the idea was to kill off Paypal in year one, they still have a long way to go,” said Jupiter Research analyst Ed Kountz.

Google is totally dominant in the search engine arena, with revenues of $7.1bn in 2006 and has seen its name evolve into a verb – “to Google” – such is its popularity.