You have to store your API key somewhere, and your site needs to know how to 
retrieve it.

There are two main issues with storing it directly in the file:

   1. As already stated, if someone gets access to your web server or FTP 
   information, they'll have your PayPal API information as well.
   2. If your web server ever gets misconfigured and displays the actual PHP 
   code on the browser (not uncommon), your API key will be shown to anyone who 
   views that URL.

It might make more sense to store those details in your application's 
database, which, as also mentioned previously, should not be accessible from 
anywhere but your web server.

Ben

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