Bloomberg reports that EBay-owned PayPal is currently in talks with Google about purchase plans for Android software, according to three people familiar with the negotiations. If the two come to agreeable terms, Android users should be able to make their app purchases via PayPal sometime this year.
It seems that Google has been having some trouble finding a pay method that works well for developers. It's said that they want to use the new payment method in order to give developers more incentive to create Android applications. Currently apps are paid for on Google Checkout. Google hopes that through the 87 million PayPal accounts currently in use, they can help make customers more eager to purchase apps for the Android and give developers more ways to make money.
In the past, the Android Developer Blog mentioned billing customers through their carrier for Android Market purchases.