News that FNB, one of South Africa's big four banks, was planning to bring the online payment system to South Africa was leaked to social network Twitter on Sunday, and was welcomed by consumers and businesses alike.

PayPal, available in more than 190 countries, including the US, Brazil and Mexico, allows more secure online trading and enables users to shop on the Internet without revealing their credit card details.

One big benefit in South Africa would be for businesses trying to attract foreign buyers, who until now have not been able to buy local products online easily.

Under South African banking law, PayPal would be illegal unless it acquired a banking licence in this country.

Another option would be for it to join forces with a local bank.

Khulekani Dlamini, portfolio manager for Afena Capital, said PayPal makes online payment easier and traders such as eBay and Amazon were lobbying for its introduction. "This means a consumer can put credit online, as he would already have an account with PayPal and it would benefit those with Internet access."

According to Dlamini, the Reserve Bank would have to change its exchange control regulations to meet the pay system's mode of operation.

"The reality with this pay system is that people would be able to trade money back and forth globally without the Reserve Bank even knowing. People could even put billions of rands through it and buy houses on eBay without bank regulation."

Though the move would be good news for consumers, FNB is yet to confirm its proposed tie-up with PayPal. The bank is said to be unhappy about the leaking of its plans and its executives were said to be meeting to establish where the leak came from.

Jessica Yellin, head of corporate communications at the bank's eBucks division, refused to disclose any information about FNB's plans.

Adrian Lackay, the Revenue Services spokesman, said he "did not know anything" about the PayPal system, which could change the status quo in foreign exchange regulations in South Africa.