Google announced it was working with PayPal to bring the ability to pay with Paypal instead of needing to use Google Checkout or carrier billing when buying apps and games.
The updated Market (version 3.3.11) which was leaked this week makes references to Paypal in its coding (pic via Aguys).
You can try the new Market by downloading the APK directly from here: Android Police
Written by: Andre Yoskowitz @ 3 Nov 2011 11:46