PayPal has added a new way for members to increase the security of their PayPal account using their mobile phone.

The PayPal SMS Security Key adds another layer of protection to PayPal accounts and uses the same security infrastructure as the PayPal Security Key, which generates a unique security code approximately every 30 seconds on a small electronic token.

"A physical device was the first form-factor for the Security Key, letting consumers press a button to display a six-digit code to get into your account, and we've had really good success in terms of the number of customers who've chosen to use it," said Michael Oldenburg, spokesman for PayPal, San Jose, CA.

"Security is not a one-size-fits all solution, though, so we're happy to work with VeriSign on this mobile service, which is a more convenient form-factor," he said. "People are already carrying around a cell phone, so we added this based on customer demand.

"We're listening to customers and finding out what would be the most convenient thing for them."

Customers can now choose to receive this unique six-digit security code via text message to their mobile phones prior to logging in to their accounts, using the codes along with their usernames and passwords to sign in.

This type of additional security, known as two-factor authentication, is used by leading financial institutions as an additional means to protect consumers and reduce losses from online fraud such as phishing attacks.

Both the PayPal Security Key token and the SMS security codes are now available to customers in the U.S., Australia, Austria, Canada and Germany.

PayPal does not charge for delivery of security codes to a mobile device. However, the mobile provider's standard text messaging charges will apply.

To use the service, customers need a mobile device and wireless service set up to receive text messages.

"We use our Web site to message to our customers when they log in to PayPal.com, and we have banner ads that talk about security and tell them about the SMS Security Key," Mr. Oldenburg said. "If customers had the unfortunate experience of having their account compromised by a fraudster, we'll recommend this mobile service to them."

The PayPal Security Key is part of the VeriSign Identity Protection (VIP) Network.

As part of this network, consumers can use the security codes to protect their accounts on a variety of financial services and e-commerce Web sites like eBay.

The new SMS functionality is provided by VeriSign's Messaging and Mobile Media division, which connects to more than 600 carriers and reaches more than 2.4 billion wireless subscribers in 150 countries.

PayPal lets members send money without sharing financial information by paying using their account balances, bank accounts or credit cards.

With more than 65 million active accounts in 190 markets and 19 currencies around the world, PayPal enables global commerce, both via mobile and the wired Web.

PayPal is an eBay company.

"This is definitely a mass-market service, so we're not targeting a specific demographic, basically those customers that want to add an extra layer of security to their account," Mr. Oldenburg said. "PayPal is already very secure, but some people like to have that extra piece of control.

PayPal plans to continue to expand upon its mobile services, but said that it's too soon to announce anything.

"Our PayPal Mobile product is an application specifically designed for mobile phones," Mr. Oldenburg said. "For example, our iPhone app lets consumers check balances and initiate payments, including P2P, consumer-to-consumer payments.

"Also, if retailers have a mobile Web site, consumers can use PayPal to pay for products and services via mobile," he said.