onsidering that nearly 7% of its business was transacted in New York last year, PayPal received some good news recently from the New York Banking Department.

Based on its review of PayPal's business model and the relationship between PayPal and its customers, the New York banking authority has concluded that PayPal is not currently engaged in illegal banking.

The Department encouraged PayPal to submit an application to obtain a New York money-transmitter license as soon as practicable. The company expects to submit an application by the end of the month.

Although PayPal recently obtained a license to operate as a money transmitter in Louisiana and Idaho, there's no word yet on whether state banking regulators in either of these states have come to the same conclusion as New York. California state regulatory authorities also are investigating PayPal.

In other PayPal news:

PayPal has registered with the Securities and Exchange Commission for a proposed secondary public offering whereby executives and other shareholders will sell six million shares of common stock.

As reported in the Wall Street Journal, although PayPal won't receive any proceeds from the secondary offering, the money raised will benefit a number of company executives, including PayPal's CEO, Peter A. Thiel.

According to PayPal's Director, Elon Musk, the board decided on a secondary offering as an attempt to manage expected selling when company insiders are free to sell.

PayPal announced that users no longer have to arrange for shipment of an item as a separate transaction. PayPal has teamed with UPS to provide its users with shipping functions within PayPal's Web site.

At the close of a transaction, the PayPal service automatically sends payments from the buyer to the seller as well as all of the information necessary to print a shipping label for the buyer. PayPal populates the shipping label with customer information as a one-step process.

UPS bills sellers directly for shipping charges. The buyer receives an e-mail message with a linked tracking number confirming shipment of the product as well as an expected date of delivery.

As a result, sellers do not need to worry about collecting additional money for shipping, and buyers are not overcharged.

PayPal has entered into an agreement to transfer its U.S. credit card processing services from Electronic Payment Exchange, Inc. to Wells Fargo .