NEW YORK (CNNMoney) -- American Express is diving into the e-wallet space with Serve, a service that lets customers transfer money to others online and make payments with their mobile phones.
In its announcement Monday, AmEx said Serve is aimed at customers who use cash, checks and debit cards, rather than the company's traditional credit card users.
Serve accounts will be available immediately in the U.S. and are expected to launch internationally over the coming year.
Mobile payments are a new direction for AmEx as it tries to get a toehold in a rapidly growing market. Research firm Generator Research expects mobile payments to reach $633 billion annually by 2014, with 490 million customers using them.
AmEx's Serve is meant to capture some of that burgeoning market. It also puts the bank squarely in competition with e-payment king PayPal. Serve grew out of technology AmEx picked up last year through its $300 million acquisition of Revolution Money, a PayPal rival that focused on person-to-person payments.
Serve accounts can be funded with a bank account, debit card, credit card or from funds transferred by another user. The accounts can be accessed through iPhone and Android apps, or through Serve.com and Facebook.
Users can set up sub-accounts for children or family members and control where the funds are used.
AmEx is waiving Serve account fees for the next six months, but after that, loading money will cost 2.9% of the transaction amount plus 30 cents per load. However, Serve won't charge a fee for loading through cash, debit or ACH (automated clearing house) transactions.
ATM cash withdrawals will cost $2, though users get one free withdrawal per month. Setting up accounts and sub-accounts is free, as are user-to-user transactions.
Meanwhile, Google (GOOG, Fortune 500) is planning its own foray into the digital payment world. On Monday, the Wall Street Journal reported that Google is partnering with MasterCard (MA, Fortune 500) and Citigroup (C, Fortune 500) to embed payment technology in Android smartphones. The goal is to allow customers make payments at stores by waving their phones in front of a reader device at the checkout.
A New Jersey agency has agreed to ban Tesla from selling cars directly to consumers in the Garden State Tuesday. More
Sprint's parent company wants to buy T-Mobile. But U.S. regulators fought hard to keep T-Mobile independent in the past and likely will do the same in the future. More
What started as a New York City ice cream truck has quickly become an empire. Here's how the Big Gay Ice Cream guys did it. More
3,000 Americans renounced their citizenship last year. Meet five U.S. citizens who have given up their passports -- or are thinking about it -- to escape a complicated tax code. More