Online payment service PayPal indicates that 2010 will be the biggest Christmas yet for Australian online retailers, as more Australians will be shunning long lines, parking chaos and early morning starts in favour of Christmas shopping online.

According to a report released by Paypal, the Australian eCommerce market is set to reach AU$36.8 billion by 2011, with 2010 online sales peaking this Christmas.

The online payment sevice attributes this to the combination of the continually strong Aussie dollar, the increasing number of Australian retailers that have expanded their offerings online and the growth in consumer confidence when shopping online. These factors have created what Paypal dubbed as the "perfect storm" for the success of online retail this Christmas.

PayPal spokesperson Adrian Christie said: "There is no doubt that the consumer-friendly climate has created a surge in online shopping. Development of innovative technologies are also driving growth in online retail and we are seeing huge growth in the adoption of mobile commerce."

The PayPal eCommerce Secure Insight Report, a research conducted by Leading Edge and Forrester Research, in behalf of the online payment service also shows that Australians prefer to buy their festive wares from home grown retailers, despite the strong Australian dollar.

According to the report, nearly a quarter of consumers prefer to 'buy Aussie' and will only shop online at domestic websites. When Australians shop overseas, PayPal research shows that a wider choice and selection of goods is the most considered factor, rather than price.

PayPal has partnered with over 50 Australian online retailers to offer its customers free shipping subject to size, weight and other conditions throughout the festive season. Consumers can take advantage of this offer at dozens of major retailers from JB Hi-Fi, to Bing Lee and General Pants.

Adrian Christie said that as of 2010, PayPal Australia has over 34,000 merchants signed up, offering its 3.5 million active users a wide and vast array of choice this Christmas.