Ebay payments division PayPal has opened its fourth data center to help it meet rising levels of demand which is coming from new avenues that are taking the payments solutions provider away from its traditional online channel.

The new data center expands PayPal’s data center footprint by a third, adding to its physical presence in California and Arizona, according to news agency Reuters.

PayPal is well known for being a strong and secure online payment method but increasingly it is seeing growth in use by physical merchant locations.

PayPal said this offers a much larger market for PayPal payments, typically found online. This is driving growth and the need for new data center space.

Reuters quoted PayPal President David Marcus who said PayPal needs “more machines, more capacity and bandwidth” to keep up with this demand.

He said PayPal hopes to be in two million physical locations by the end of the year.

It is not the only initiative it is taking to expand its offering – PayPal is laso looking at smartphone payments methods.