Google Checkout is banned by eBay

Online auction site eBay has banned its buyers and sellers from using Google's new online payments service, Google Checkout, in a move that seems designed to protect its own PayPal operation.

Any sellers caught offering Google Checkout face having their listings cancelled, forfeiting their fees or even having their entire account suspended.

The news came as eBay announced that Jeff Jordan, head of PayPal, who is seen as a potential successor to chief executive Meg Whitman, will leave this year in the most high-profile defection from the business. He plans to spend more time with his family.

The Checkout ban is yet another indication that Google is encroaching on areas that other companies consider their turf. Having created the web's most widely used search engine, Google has moved into email, instant messaging, word processing, spreadsheets, price comparison and now payments. Companies from AOL and Amazon to Microsoft are finding Google on their patch.

Google started marketing its payment service to online retailers last month, having previously made it available to buy adverts from the search engine or videos from Google Video.

The eBay site updated its accepted payments policy to specifically exclude Checkout. It joins a host of online payment services eBay bans, including AlertPay.com, AuctionChex.com, eHotPay.com, a href="http://www.Moneygram.com">Moneygram.com, neteller.com, ecount.com, and xcoin.com.

It allows payments by traditional methods such as credit and debit cards, personal cheques, money orders and cash but strongly encourages sellers to use PayPal.