Security tokens coming for eBay's PayPal customers

Internet auction company eBay will offer its PayPal customers a key fob token over the next few months to enhance the security of the online payment service. The two-factor authentication tool will generate a new one-time password, in the form of a six-digit number, whenever the user presses the button on the token. The PayPal customer will input the code each time they login to the site, as well as their existing password, enhancing the security for eBay customers, according to the auction firm.

"If a fraudulent party somehow got hold of a person's username and password, they still would not be able to get into the account because they do not have the six-digit code," a PayPal spokeswoman said.

"This is by no means a silver bullet that is going to stop fraud. It is just another layer of protection," she added.

The device, which uses VeriSign technology, will be free for eBay consumers with a business account, but will cost around £3 ($5.83) for personal PayPal account holders, the e-commerce company said.

After several months of testing the system, the token is now available to consumers in the United States, Germany and Australia. It is expected to be rolled out across the U.K. over the next few months.