Google Checkout has another arena where they can beat Paypal:
Money sending to developing countries.  This is a huge business.
This is the money sent from immigrants to its relatives in their origin
countries.
Just for Latin America, they send yearly 25,000 millions.
Big business for banks and companies like Western Union.

Another alternative is to send electronically the money thru internet.
Paypal guys are very restrictive, they make business only with certain
countries.
They make business only with 8 LA countries. If you have the bad luck
to live in some other place, you're out of the network.  However, since
the creation of Google Checkout, they have started to grow agressively
in other countries.

Google Checkout started small (just with US), but they are growing
internationaly very fast. Now counts 32 countries -- Well, Paypal
handles 103...

This is a race that has just started. Now, Google Checkout needs to
accept person-to-person transfers and it would became a very serious
competitor for Paypal.  Mix that with Google Base, and it could become
a big rival of eBay...