Explanation of PayPal

History
PayPal was formed in March 2000 when Confinity and X.com merged. Confinity was originally an Internet-based Palm Pilot account payment option, and X.com was a financial services company. In 2002, eBay acquired PayPal for $1.5 billion.
Function
A PayPal account can make transfers or payments from a bank account or a credit card; a recipient of a money transfer can sign up for a PayPal debit card, request a check from PayPal or transfer the funds to a bank account.
Significance
PayPal facilitates worldwide e-commerce while managing over 70 million accounts in 19 different currencies.
Warning
The impersonal nature of e-commerce creates an enhanced risk of fraud, especially because the only requirement to make a money transfer is knowledge of a user's account ID and password.
Security Options
As a protection against fraud, PayPal users now have the option to buy a $5 security key. After entering their user IDs and passwords, members are prompted to enter a six-digit security code that is recreated on the display screen of the actual key during every login attempt.