Facebook teams up with PayPal

Facebook, which recently passed the 400 million global users mark, said advertisers around the world would soon be able to use PayPal to pay for Facebook ads, which would make it easier, particularly for small international companies, to run campaigns.

PayPal will also become an option for Facebook Credits, the trial system allowing users to buy virtual goods currently being tested in a small number of games and applications.

Osama Bedier, PayPal's vice-president of platform and emerging technology, said: "We've always been an important part of the developer ecosystem on Facebook, and we're excited to expand our relationship directly with Facebook to help grow advertisers and developers' business."

Earlier this month a US analyst claimed Facebook's payment system was proving lucrative and predicted it would bring in revenues of between $125 million and $250 million this year.

PayPal, which was bought by eBay in 2002 for close to $1.5 billion, kicked off a pitch for its advertising account this week.