diff --git a/commerce_checkout_login.module b/commerce_checkout_login.module
index e812f22..825ccec 100644
--- a/commerce_checkout_login.module
+++ b/commerce_checkout_login.module
@@ -5,6 +5,57 @@
  * Adds an inline login form to the Account Information checkout pane.
  */
 
+/**
+ * Implements hook_form_FORM_ID_alter().
+ *
+ * Capture checkout pane settings
+ */
+function commerce_checkout_login_form_commerce_checkout_pane_settings_form_alter(&$form, &$form_state, $form_id) {
+  // Exit if not account checkout pane
+  if (!isset($form['checkout_pane']['#value']['pane_id']) || $form['checkout_pane']['#value']['pane_id'] != 'account') {
+    return;
+  }
+
+  $form['settings']['commerce_checkout_login'] = array(
+    '#type' => 'fieldset',
+    '#title' => t('Commerce checkout login configuration'),
+  );
+  $settings_form = &$form['settings']['commerce_checkout_login'];
+
+  $settings_form['commerce_checkout_login_username'] = array(
+    '#type' => 'checkbox',
+    '#title' => t('Allow new customers choose their username'),
+    '#description' => t('If checked, a new customer will have the option to choose a username.'),
+    '#default_value' => variable_get('commerce_checkout_login_username', FALSE),
+  );
+
+  $settings_form['commerce_checkout_login_password'] = array(
+    '#type' => 'checkbox',
+    '#title' => t('Allow new customers choose their password'),
+    '#description' => t('If checked, a new customer will have the option to choose a password if the system wide settings permit this.'),
+    '#default_value' => variable_get('commerce_checkout_login_password', FALSE),
+  );
+
+  $settings_form['commerce_checkout_login_send_welcome_message'] = array(
+    '#type' => 'checkbox',
+    '#title' => t('Send welcome e-mail after creating a new user.'),
+    '#description' => t('If checked, an e-mail with a welcome message (no approval required) will be sent to the new user. You can configue the message !here.', array('!here' => l(t('here'), 'admin/config/people/accounts'))),
+    '#default_value' => variable_get('commerce_checkout_login_send_welcome_message', FALSE),
+  );
+  $settings_form['commerce_checkout_login_send_welcome_message_show_message'] = array(
+    '#type' => 'checkbox',
+    '#title' => t('Show an e-mail notification message.'),
+    '#description' => t('If checked, a system message will be set, notifying the user of the welcome e-mail being sent.'),
+    '#default_value' => variable_get('commerce_checkout_login_send_welcome_message_show_message', FALSE),
+    '#prefix' => '<div style="margin-left:2em;">',
+    '#suffix' => '</div>',
+    '#states' => array(
+      'invisible' => array(
+        ':input[name="commerce_checkout_login_send_welcome_message"]' => array('checked' => FALSE),
+      ),
+    ),
+  );
+}
 
 /**
  * Implements hook_form_FORM_ID_alter().
@@ -14,6 +65,7 @@
  */
 function commerce_checkout_login_form_commerce_checkout_form_alter(&$form, &$form_state) {
   global $user;
+  $show_conf_mail = variable_get('commerce_order_account_pane_mail_double_entry', FALSE);
 
   // If the Account Information pane is on the current checkout page and the
   // user is not logged in...
@@ -25,31 +77,65 @@ function commerce_checkout_login_form_commerce_checkout_form_alter(&$form, &$for
       ),
     );
 
+    // Add ajax to confirmation mail for immediate validation:
+    if (isset($form['account']['login']['mail_confirm'])) {
+      $form['account']['login']['mail_confirm']['#ajax'] = array(
+        'callback' => 'commerce_checkout_login_checkout_form_refresh',
+        'wrapper' => 'account-login-container',
+      );
+    }
+
     // Check the form state to see if an e-mail address has been specified.
-    if (!empty($form_state['values']['account']['login'])) {
-      $mail = trim($form_state['values']['account']['login']['mail']);
+    if (!empty($form_state['values']['account']['login']['mail']) || !empty($form_state['order']->mail)) {
+      $mail = !empty($form_state['values']['account']['login']['mail']) ? trim($form_state['values']['account']['login']['mail']) : $form_state['order']->mail;
 
       // Don't attempt to load the user for an invalid e-mail address.
-      if ($error = user_validate_mail($mail)) {
-        form_set_error('account][login][mail', $error);
-      }
-      elseif ($account = user_load_by_mail($mail)) {
-        // If a user already exists for the given e-mail address, display a
-        // message letting the customer know this.
-        $form['account']['login']['mail']['#description'] = t('There is already an account registered to %mail. You can login now to use your account information during checkout.', array('%mail' => $mail));
-
+      if (!user_validate_mail($mail) && user_load_by_mail($mail)) {
+        // An existing e-mail address has been entered. Add a password field to
+        // allow the customer to login.
         $form['account']['login']['password'] = array(
           '#type' => 'password',
           '#title' => t('Password'),
+          '#required' => TRUE,
+          '#description' => t('Please enter the password for your account. !forgot', array('!forgot' => l(t('Did you forget your password?'), 'user/password')))
         );
 
-        $form['account']['login']['login_now'] = array(
-          '#type' => 'submit',
-          '#value' => t('Login now'),
-          '#limit_validation_errors' => array(array('account')),
-          '#validate' => array('commerce_checkout_login_checkout_form_validate'),
-          '#submit' => array('commerce_checkout_login_checkout_form_submit'),
-        );
+        // No e-mail confirmation is required to login. So we hide the e-mail
+        // confirmation field if it is set.
+        if (isset($form['account']['login']['mail_confirm'])) {
+          $form['account']['login']['mail_confirm']['#value'] = $mail;
+          $form['account']['login']['mail_confirm']['#access'] = FALSE;
+        }
+      }
+      elseif (variable_get('commerce_checkout_login_username', FALSE) || variable_get('commerce_checkout_login_password', FALSE)) {
+        if (variable_get('commerce_checkout_login_username', FALSE)) {
+          $form['account']['login']['name'] = array(
+            '#type' => 'textfield',
+            '#title' => t('Username'),
+            '#maxlength' => USERNAME_MAX_LENGTH,
+            '#description' => t('Spaces are allowed; punctuation is not allowed except for periods, hyphens, apostrophes, and underscores.'),
+            '#attributes' => array('class' => array('username')),
+          );
+        }
+
+        // Find out if email verification is required.
+        $mail_verify = variable_get('user_email_verification', TRUE);
+        $mail_verify = !$mail_verify ? variable_get('logintoboggan_confirm_email_at_registration', 0) : $mail_verify;
+
+        // If password selection is enabled and verification is not required add
+        // the password field.
+        if (variable_get('commerce_checkout_login_password', FALSE) && !$mail_verify) {
+          $desc = t('Provide a password for the new account in both fields.');
+          if ($min_pass = variable_get('logintoboggan_minimum_password_length', 0)) {
+            $desc .= ' ' . t('Password must be at least %length characters.', array('%length' => $min_pass));
+          }
+
+          $form['account']['login']['pass'] = array(
+            '#type' => 'password_confirm',
+            '#size' => 25,
+            '#description' => $desc,
+          );
+        }
       }
     }
   }
@@ -59,50 +145,219 @@ function commerce_checkout_login_form_commerce_checkout_form_alter(&$form, &$for
  * Ajax callback: returns the account information pane to an AJAX request.
  */
 function commerce_checkout_login_checkout_form_refresh($form, $form_state) {
-  return $form['account']['login'];
+  $show_conf_mail = variable_get('commerce_order_account_pane_mail_double_entry', FALSE);
+
+  $mail = !empty($form_state['values']['account']['login']['mail']) ? trim($form_state['values']['account']['login']['mail']) : '';
+  _validate_email($mail);
+
+  if (!$show_conf_mail) {
+    return $form['account']['login'];
+  }
+
+
+  // Return AJAX commands to set focus to the mail confirmation field for
+  // improved user experience.
+  $commands = array();
+  $commands[] = ajax_command_replace('#' . $form['account']['login']['mail']['#ajax']['wrapper'], drupal_render($form['account']['login']));
+  $commands[] = ajax_command_invoke('[name="account[login][mail_confirm]"]', 'focus');
+  print ajax_render($commands);
+  exit;
 }
 
 /**
- * Validate callback: validate the user credentials
+ * Implements hook_commerce_checkout_pane_info_alter().
  */
-function commerce_checkout_login_checkout_form_validate($form, &$form_state) {
-  // @todo Add flood control support as in user_login_authenticate_validate().
-  $account = user_load_by_mail($form_state['values']['account']['login']['mail']);
-
-  // If the user account is blocked...
-  if (user_is_blocked($account->name)) {
-    // Display an appropriate error message.
-    form_set_error('account][login][email', t('The username %name has not been activated or is blocked.', array('%name' => $account->name)));
+function commerce_checkout_login_commerce_checkout_pane_info_alter(&$checkout_panes) {
+  if (isset($checkout_panes['account'])) {
+    $checkout_panes['account']['callbacks']['checkout_form_validate'] = 'commerce_checkout_login_commerce_checkout_pane_validate';
+    $checkout_panes['account']['callbacks']['checkout_form_submit'] = 'commerce_checkout_login_commerce_checkout_pane_submit';
   }
-  elseif ($uid = user_authenticate($account->name, $form_state['values']['account']['login']['password'])) {
-    // Otherwise, if the user authenticates based on the name of the loaded
-    // account and the supplied password, retain the uid to login the user on
-    // final submission.
-    $form_state['commerce_checkout_login_uid'] = $uid;
+}
+
+/**
+ * Account checkout pane validation.
+ */
+function commerce_checkout_login_commerce_checkout_pane_validate(&$form, &$form_state, $checkout_pane, $order) {
+  $mail = !empty($form_state['values']['account']['login']['mail']) ? trim($form_state['values']['account']['login']['mail']) : $form_state['order']->mail;
+  $validated = _validate_email($mail);
+
+  if ($account = user_load_by_mail($mail)) {
+    $validated = _validate_existing_account($form, $form_state, $account);
   }
+  // A non-existing e-mail address has been entered.
   else {
-    // But indicate that we could not login the user if validation failed.
-    form_set_error('account][login][password', t('Sorry, unrecognized username or password. <a href="@password">Have you forgotten your password?</a>', array('@password' => url('user/password'))));
+    // Validate e-mail confirmation field if set.
+    if (isset($form['account']['login']['mail_confirm'])) {
+      $mail_confirm = !empty($form_state['values']['account']['login']['mail_confirm']) ? trim($form_state['values']['account']['login']['mail_confirm']) : '';
+      if (empty($mail_confirm) || $mail != $mail_confirm) {
+        form_set_error('account][login][mail_confirm', t('The specified e-mail addresses do not match.'));
+        $validated = FALSE;
+      }
+    }
+
+    if (isset($form['account']['login']['password'])) {
+      // A password field is present. During rebuild of the form, this password
+      // field will be removed because a non-existing email address was entered.
+      // Previous form validation might already have set a password required
+      // message. We need to remove said message.
+      $messages = drupal_get_messages('error');
+      $password_title = $form['account']['login']['password']['#title'];
+      foreach ($messages['error'] as $message) {
+        if ($message != strip_tags(t('The field %field is required.', array('%field' => $password_title)))) {
+          // This message is not the password required message, re-add it.
+          drupal_set_message($message, 'error');
+        }
+      }
+    }
+
+    $username = substr($mail, 0, strpos($mail, '@'));
+    if (variable_get('commerce_checkout_login_username', FALSE)) {
+      $username = $form_state['values']['account']['login']['name'];
+      // Validate username.
+      if ($error = user_validate_name($username)) {
+        form_set_error('account][login][name', $error);
+        $validated = FALSE;
+      }
+      // Make sure the name is not already taken.
+      elseif ((bool) db_select('users')->fields('users', array('uid'))->condition('name', db_like($username), 'LIKE')->range(0, 1)->execute()->fetchField()) {
+        form_set_error('account][login][name', t('The name %name is already taken.', array('%name' => $username)));
+        $validated = FALSE;
+      }
+    }
+    else{
+      // Make sure the automatic username does not already exist.
+      $similar_names = db_select('users')
+        ->fields('users', array('uid', 'name'))
+        ->condition('name', db_like($username), 'LIKE')
+        ->execute()
+        ->fetchCol(1);
+      if ($similar_names && in_array($username, $similar_names)) {
+        for ($i = 1; $i < count($similar_names) + 2; $i++) {
+          if (!in_array($username.$i, $similar_names)) {
+            $username = $username.$i;
+            break;
+          }
+        }
+      }
+    }
+
+    if (variable_get('commerce_checkout_login_password', FALSE)) {
+      // Validate password if logintoboggan is present.
+      if (isset($form_state['values']['account']['login']['pass']) && module_exists('logintoboggan')) {
+        if ($error = logintoboggan_validate_pass($form_state['values']['account']['login']['pass'])) {
+          form_set_error('account][login][pass', $error);
+          $validated = FALSE;
+        }
+      }
+    }
+
+    if ($validated) {
+      // Create new user.
+      $edit = array(
+        'name' => $username,
+        'mail' => $mail,
+        'init' => $mail,
+        'pass' => isset($form_state['values']['account']['login']['pass']) ? $form_state['values']['account']['login']['pass'] : user_password(),
+        'status' => 1,
+        'timezone' => variable_get('user_default_timezone', variable_get('date_default_timezone', '')),
+      );
+
+      $account = user_save(NULL, $edit);
+      // set the uid to enable automatic login on submit.
+      $form_state['commerce_checkout_login_uid'] = $account->uid;
+
+      if (variable_get('commerce_checkout_login_send_welcome_message', FALSE)) {
+        _user_mail_notify('register_no_approval_required', $account);
+        if (variable_get('commerce_checkout_login_send_welcome_message_show_message', FALSE)) {
+          drupal_set_message(t('A welcome message with further instructions has been sent to your e-mail address.'));
+        }
+      }
+    }
   }
+
+  return $validated;
 }
 
 /**
- * Submit callback: attempt a login of the user now.
+ * Account checkout pane submit handler.
  */
-function commerce_checkout_login_checkout_form_submit($form, &$form_state) {
+function commerce_checkout_login_commerce_checkout_pane_submit(&$form, &$form_state, $checkout_pane, $order) {
   global $user;
 
   if (!empty($form_state['commerce_checkout_login_uid'])) {
-    // Load the specified user into the global $user variable.
-    $user = user_load($form_state['commerce_checkout_login_uid']);
+    if (!empty($user->uid)) {
+      // Load the full user object
+      $user = user_load($user->uid);
+    }
+    else {
+      // Load the specified user into the global $user variable.
+      $user = user_load($form_state['commerce_checkout_login_uid']);
 
-    // "Finalize" the login by triggering the appropriate system messages, IP
-    // address and login timestamp logging, and user login hook.
-    user_login_finalize();
+      // "Finalize" the login by triggering the appropriate system messages, IP
+      // address and login timestamp logging, and user login hook.
+      user_login_finalize();
+    }
 
     // Convert the current cart order to an authenticated cart for the current
     // user and clear out our variable from the form state.
-    commerce_cart_order_convert($form_state['order'], $user);
+    $oid = is_object($form_state['order']) ? $form_state['order']->order_id : $form_state['order'];
+    $order = commerce_order_load($oid);
+    if (empty($order->uid)) {
+      commerce_cart_order_convert($order, $user);
+    }
     unset($form_state['commerce_checkout_login_uid']);
   }
 }
+
+/**
+ * Email validation helper
+ */
+function _validate_email($mail) {
+  if ($error = user_validate_mail($mail)) {
+    form_set_error('account][login][mail', $error);
+    return FALSE;
+  }
+  return TRUE;
+}
+
+/**
+ * Known user validation helper.
+ */
+function _validate_existing_account(&$form, &$form_state, &$account) {
+  if ($user = user_uid_optional_load()) {
+    if ($user->uid === $account->uid) {
+      // Nothing to validate, the user is already logged in.
+      return TRUE;
+    }
+  }
+  // If there is no password field present, the customer has not yet been
+  // informed about the the pre-existing account. We therefore have to inform
+  // the customer about this.
+  if (!isset($form['account']['login']['password'])) {
+    $message = t('There is already an account registered to %mail. Please enter your password to continue checkout.', array('%mail' => $account->mail));
+    drupal_set_message($message, 'warning');
+    // By invalidating the form submission we trigger a rebuild which will cause
+    // the password field to be rendered.
+    return FALSE;
+  }
+  else {
+    // If the user account is blocked...
+    if (user_is_blocked($account->name)) {
+      // Display an appropriate error message.
+      form_set_error('account][login][email', t('The username %name has not been activated or is blocked.', array('%name' => $account->name)));
+      return FALSE;
+    }
+
+    // If the user authenticates based on the name of the loaded account and the
+    // supplied password, retain the uid to login the user on final submission.
+    if ($uid = user_authenticate($account->name, $form_state['values']['account']['login']['password'])) {
+      $form_state['commerce_checkout_login_uid'] = $uid;
+      return TRUE;
+    }
+    else {
+      // Indicate that the user could not be logged in if validation failed.
+      form_set_error('account][login][password', t('Sorry, unrecognized username or password. !password', array('!password' => l('Have you forgotten your password?', 'user/password'))));
+      return FALSE;
+    }
+  }
+}