In a company-issued statement, Google CEO Eric Schmidt said the company does not plan to offer what he called a "person-to-person stored-value payments system."

One of the main features of PayPal, a division of eBay Inc., is the ability for consumers to store balances in order to make e-commerce payments.

Following a story by the Wall Street Journal published on Friday, speculation ran rampant about Google offering a PayPal competitor.

Instead, Schmidt said that Google is looking to expand its current online payment services, which is largely used to handle payments from advertisers and to Web publishers in Google's popular online advertising programs.

Schmidt stopped short of offering details about Google's next online payment plans or when the Mountain View, Calif., company will introduce a broader service.

"The payment services we are working on are a natural evolution of Google's existing online products and advertising programs, which today connect millions of consumers and advertisers," Schmidt said in the statement. "We are building products in the area to solve new problems in e-commerce."