I am often asked why PayPal do not allow South Africans to receive money as it can be argued this largely prevents South Africans from fully participating in the global Internet economy. I imagine for the most part South Africans would use PayPal for International transactions i.e. receiving money from people outside South Africa for various online (and possibly offline) services. For transactions with fellow South Africans, first of all PayPal don't offer the local currency and secondly why would people want to transact using PayPal when they can use the local banking system at no (or a significantly reduced) cost compared to using PayPal? Maybe South Africans trading with each other would still use PayPal for convenience factor and the instant nature of the system (not having to wait for payments to clear - this would certainly be a plus for merchants)?
Considering PayPal has only allowed South Africans to make payments using PayPal since June 2005, some people might say PayPal is simply not interested in the South African market as it is too small. As far as I am aware the main reason PayPal does not allow South Africans to receive money with PayPal is because of South African exchange control regulations imposed by the South African Reserve Bank. There are ways around this of course. If you know some with a US, UK or Australian bank account for example you could ask them to set up a PayPal account for you through which you can receive money and you would then have to get them to transfer you this money using an International TT periodically (quite a mission). Alternatively you could set out to open a foreign bank account for yourself (even more of a mission).
Until the Reserve bank totally relaxes exchange control regulations (my tax advisor told me 2 years ago that she believed this was imminent at the time but last time I met with her she seemed to have back tracked on that opinion somewhat), I don't think we will see PayPal opening up any further to South Africans.