eBay is preparing to add another layer of security to the PayPal online payment system. Not that PayPal security is anything to laugh at in the first place, but it’s always nice to have another buffer between you and Johnny Phisher. But that layer of security isn’t a new sitekey system like so many banks are using now, it comes in the form of a key fob.

The diminutive hardware device cranks out a new password every 30 seconds. This system ensures that only the holder of said key fob has the password to access the account. I’ve seen a few of these devices used by corporate managers and they’re actually pretty neat. The devices I’ve seen were provided by RSA and even offer a countdown timer to know when you’ll receive a new password.

Sara Bettencourt, a PayPal spokesperson, said that, “if a fraudulent party somehow got hold of a person’s username and password, they still wouldn’t be able to get into the account because they don’t have the six-digit code.” But don’t go thinking that you’ll be 100% safe with your PayPal account. It’s still a great idea to change your password every so often, roughly every 90 days.

I’m glad to see that eBay and PayPal are doing something to help combat the flood of phishing scams on the web today. The only thing I don’t like about the device is the fact that it will more than likely be lost by a number of people. Then what? I’m sure PayPal has addressed this issue, but it would still stink to lose the access keyfob to your account. Thanks, Johnny Phisher. You’ve succeeded in making everyone else’s lives a little more miserable. Why can’t you just learn how to make money the honest way like all the rest of us?

The new key fobs should be available in the next month or so, as PayPal has been testing internally for a couple of months. If you’re a business customer with PayPal, your key fob will be free. Personal account holders will need to shell out $5 to add another layer of security, one that I think is well worth the investment.

Read [Daily Tech]