eBay's online payment service PayPal launched its Pay Later service on eBay.com yesterday. PayPal first launched the financing service for retail sites last year (http://www.auctionbytes.com/cab/abn/y07/m08/i02/s01). PayPal Pay Later now offers eBay buyers in the United States a financing offer of no payments for 90 days for qualifying purchases between $50 and $199.

Sellers who accept PayPal on eBay will automatically offer the Pay Later payment option. According to an announcement on eBay, the availability and details of the special financing offers will vary over time, and will be based on the item price as well as other factors.

The Pay Later service is similar to Bill Me Later - a popular payment option on large retail websites. Such services say they can improve conversion rates for merchants by making it easy for shoppers to make a purchase and pay later, without the necessity of entering credit card information on websites.

With PayPal Pay Later, buyers have more ways to pay for items at checkout and can use Pay Later even if they don't have a PayPal account. The application can be completed in 30 seconds and provides a buyer with instant access to credit.

According to the service, Pay Later purchases are the same as regular PayPal purchases: the sellers are paid quickly, and standard PayPal fees apply.

When asked what would happen if a buyer failed to pay through Pay Later's financing, PayPal spokesperson Michael Oldenburg told AuctionBytes, "Merchants get paid in full by PayPal right away. Buyers then make payments to GE Money through bills received in the mail."

Note: Do not use the following link to sign in to PayPal.

https://www.paypal.com/shopnow