PayPal Inc. is taking a new approach to targeting consumers, merchants and developers in its quest to expand in Japan.

Unlike the U.S., where the payments service is closely tied to its parent, the online auction company eBay Inc., PayPal will have to attract its own customer base in Japan. EBay pulled out of Japan in 2002, conceding the auction market to Yahoo Japan. In 2007 the two companies struck a deal in which Japanese consumers could access eBay through Yahoo's shopping site.

Last week PayPal announced plans to expand its payments services in Japan.

Even without eBay, PayPal is confident it will succeed in Japan, said Andrew Pipolo, the head of PayPal Japan. "We are very excited about our growth opportunities in the Japanese market," he said, citing not only international trading but also "merchants and consumers selling and buying within Japan."

Nomura Research Institute in Tokyo has predicted that the Japanese e-commerce market will grow from $77.2 billion in 2009 to $142.3 billion 2014. Because Japanese consumers often use mobile commerce, PayPal will launch Mobile Express Checkout for Japanese merchants in the near future, Pipolo said.

PayPal, which entered Japan in 2008, has more than 1 million accounts there. The accounts are used primarily to make purchases from overseas merchants.

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