Samsung Acquires LoopPay Startup: Company Will Compete With Apple Pay Electronic Wallet
Samsung recently acquired mobile payments startup company LoopPay. It looks like with this acquisition Samsung wants to directly compete with Apple Pay, CNET reports.
Samsung and LoopPay had a prior partnership that led to the acquisition. Terms of the deal were not yet available. Samsung plans to show off a new mobile payment solution on March 1 when it also launches the new Galaxy S6 smartphone.
"Our goal has always been to build the smartest, most secure, user-friendly mobile wallet experience, and we are delighted to welcome LoopPay to take us closer to this goal," said JK Shin, Samsung co-CEO and head of the company's mobile business, in a press release.
The benefit of LoopPay compared to Apple Pay is with the technology. LoopPay was able to find a way to use the exisiting magnetic strip readers in current point of sale (POS) terminals and turn them into contactless payment receivers. Apple Pay required the usage of near field communications (NFC) technology, and that required retailers to update their terminals to accept NFC payments.
LoopPay could work in up to 90 percent of existing POS terminals without having to upgrade, Samsung says. Users of the service will also be able to include their loyalty cards in LoopPay transactions. This is something Apple Pay has not been able to offer.
"What's a real differentiator is this uses technology that's in stores today," said David Eun, executive vice president of Samsung's global innovation center. "We don't have to wait for a point in the future where there are a lot more [NFC-enabled] terminals."
Eun did not say if LoopPay will continue to work with iPhones and other smartphones or if it would become a Samsung-exclusive payment solution.
"It's not just about replacing your credit card or debit card but replacing your entire wallet," Eun said.
Samsung has some competition in the mobile payment market. Google, Apple and a new payment solution from AT&T, T-Mobile and Verizon called Softcard are all competing to become the new way to pay for goods and services.
Samsung thinks they have a unique product though.
"The key here is differentiation," said Injong Rhee, the head of Samsung's mobile payments and enterprise businesses.
What do you think of Samsung offering a mobile payment solution? Will it be any better than Apple Pay? Leave a comment below.
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