Yes and no.

PayPal offers a full range of payment services that includes debit and credit cards, a savings account paying more than 5%, and loan options on major eBay purchases. Sounds pretty much like a bank, doesn't it?

But are they the biggest? According to eBay's earning release yesterday, PayPal ended the quarter with 123 million accounts, 36 million MORE than they had a year ago (41% growth). The new accounts alone would dwarf almost any financial services company in the world; for instance, American Express has 74 million accounts worldwide (as of June 30), up 7 million since a year earlier.

So yes, by number of accounts, PayPal is clearly the global leader in financial services. However, by most other measures, PayPal's size is more modest.

For example, unlike most financial companies, the majority of PayPal's accounts were inactive. During third quarter, less than a quarter of its accounts made a payment.

Those 31 million active accounts made an average of 5 transactions during the quarter, resulting in a total of 146 million payments worth $9.1 billion (an average of $62 per payment). Across the entire 123 million base, that amounts to just $73 in spending per account. In comparison, American Express cardmembers spent 15 times more, $141 billion in second quarter, an average of $1,900 per card.

In summary, PayPal is an enourmous financial services company, growing far faster than most rivals. But it's still a niche service for online purchasing, primarily at eBay. However, with more than 100 million accounts and one of the most widely recognized online brands, PayPal is in a position to compete with major banks around the globe.