Korean tech chaebol (conglomerate) Samsung Electronics Co Ltd intends to give Apple Pay a run for its money and thus a showdown between the two rivals might ensue. In that respect, Samsung has taken steps and bought mobile wallet startup LoopPay. This makes no secret about the fact that this poses a clear intention to launch a smartphone payments service to rival the recent proposal issued by Apple Inc. Although mobile payments are threading slowly not only in the U.S but also worldwide, that didn’t stop Apple, Google, eBay via PayPal to launch this similar service that allows users to pay via smartphones. As of now, Samsung joins this bunch and boarded the mobile payments train as well and we’re just left to see where this leads to.
Why this slow start with the mobile payments? Well, retailers haven’t been quick to adopt both the hardware and software infrastructure that these new mobile payment options demand and what’s more, the mobile payment service also fails to offer the convenience of simply swiping a credit card. And this apparently is a point of view that Samsung shares and aims to improve. So where startup LoopPay does comes into play? Pun intended. The difference lies in the fact that LoopPay’s technology uses already-existing magnetic-stripe card readers at checkout and changes them into contactless receivers. This means that there is no need to change the hardware and implement a new technology, instead improve upon the existing one, because 90 percent of checkout counters already support magnetic swiping.
According to David Eun, head of Samsung’s Global Innovation Center, if the problem of merchant acceptance can’t be solved first by being able to use the vast majority of cards, then this doesn’t really look like a wallet. The leader of Samsung’s payments project Injong Rhee said that the Korean tech giant will reveal more information in detail about this service, but it is still debatable whether this will occur during the Mobile World Congress in Barcelona or not. Can we expect this feature on the upcoming Galaxy S6 as well? Apple Pay already allows the iPhone user to make payments with a simple tap of a button and since its launch in September, many praised its fast rollout so far with more than 2,000 banks supporting it. By acquiring LoopPay, Samsung could aim for the same glory
LoopPay and Samsung are in talks to detrone Apple Pay
So far, Apple Pay however works if the merchant has a special NFC (near field communication) pad that can talk to either the iPhone 6 or 6 Plus and unfortunately the vast majority of vendors haven’t adopted this system yet. Samsung launches the S6, presumably in March and if the talks with LoopPay come to fruition this system will be built into the next-gen Galaxy phone. True, Samsung’s current flagships(Note 4 and S5) do have PayPal integration that works in tandem with a fingerprint sensor but this isn’t of much use since PayPal is accepted in fewer stores than Apple Pay. Another issue arises though: if Samsung decides to partner up with LoopPay won’t PayPal get offended? Feel free to comment.