PayPal, which provides a safer way for consumers to buy internet goods, has developed a new chip and pin device which will make it easier for market stall holders and cab drivers to accept card payments.

Some smaller firms find it costly to take card payments and have relied on cash or cheques.

The latest gadget, will be available from the summer, is linked to an app on the traders' smartphone.

PayPal said the innovation is aimed at small firms and seasonal traders as they will not be tied into a contract but will need to pay a yet-to-be-disclosed one-off charge and a "small fee" per transaction.