Millions of consumers will be able to buy goods using their mobile phones from the end of the month, when PayPal, the payments system owned by Ebay, the internet firm, launches a new mobile service.

Customers who sign up for PayPal Mobile will be able to purchase goods instantly by sending a simple text message. They will also be able to make payments to other PayPal users.

The company claimed it would be the first mass-market mobile-payments system in Britain. About 10 million people in the UK, and another 105 million worldwide, already use PayPal to make secure online payments when they buy and sell on Ebay.

Retailers who sign up for the Text to Buy service will publish product codes when they advertise their goods on the internet, in magazines or on television. Customers will simply text the relevant code to PayPal, after which an automated service will call them back and ask for a Pin number. PayPal will then pay the retailer and the goods will be sent direct to the user’s home.

Customers who want to make mobile payments to other users will simply text the amount and the phone number to PayPal.

Geoff Iddison, chief executive of PayPal, said: "The system is password protected so even if the account holder’s phone is lost or stolen, the PayPal account remains secure.

Like all transactions with PayPal, mobile payments are safe for all our users and customer’s financial details are not shared with merchants: they remain within the PayPal network at all times."

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