Back in February, we heard that Samsung had acquired the mobile payments system LoopPay. Samsung is leveraging the technology they acquired to develop their new Samsung Pay mobile payments platform.
When the deal was announced, no details were disclosed on how much Samsung would be paying to acquire LoopPay. However, according to a recent report by re/code, Samsung apparently paid around $250 million to get their hands on LoopPay, although this has yet to be confirmed.
The Technology Behind LoopPay
LoopPay’s technology is quite innovative and distinct from other mobile payment systems. Unlike NFC (Near Field Communication) based systems, LoopPay uses Magnetic Secure Transmission (MST) technology. This allows it to work with traditional magnetic stripe card readers, which are still widely used in many retail locations. This gives Samsung Pay a significant advantage in terms of compatibility, as it can be used in a broader range of stores compared to NFC-only systems.
Samsung introduced their new Samsung Pay mobile payment system, which is based on LoopPay, earlier in the year. It is expected to launch sometime in the US within the next few months. The integration of LoopPay’s MST technology into Samsung Pay means that users will be able to make payments at nearly any terminal that accepts credit cards, making it a versatile and convenient option for consumers.
Competition in the Mobile Payments Market
Samsung and Apple are both looking to make their mobile payment systems major players in the mobile payments sector. Apple Pay, which relies on NFC technology, has already gained significant traction since its launch. However, Samsung Pay’s ability to work with both NFC and MST gives it a unique edge. This dual compatibility could potentially make Samsung Pay more appealing to a wider audience, especially in regions where NFC adoption is still growing.
Moreover, Samsung Pay also incorporates robust security features. It uses tokenization, which replaces sensitive card information with a unique identifier, and biometric authentication, such as fingerprint scanning, to ensure secure transactions. These features are crucial in building consumer trust and encouraging widespread adoption of mobile payment systems.
The mobile payments market is rapidly evolving, with various players entering the space. Google has also rebranded its payment service to Google Pay, aiming to streamline its offerings and provide a unified payment experience. Additionally, other tech giants and financial institutions are exploring their own solutions, further intensifying the competition.
The success of mobile payment systems largely depends on user adoption and merchant acceptance. While Apple Pay has made significant strides in both areas, Samsung Pay’s broader compatibility could help it catch up quickly. The convenience of being able to use Samsung Pay at virtually any payment terminal is a compelling selling point.
The acquisition of LoopPay by Samsung for an estimated $250 million marks a strategic move to strengthen its position in the mobile payments market. By integrating LoopPay’s MST technology, Samsung Pay offers a versatile and secure payment solution that could potentially outshine its competitors. As the mobile payments landscape continues to evolve, it will be interesting to see how Samsung Pay and Apple Pay fare in their quest to become the dominant player in this space.
Source
Latest Geeky Gadgets Deals
Disclosure: Some of our articles include affiliate links. If you buy something through one of these links, Geeky Gadgets may earn an affiliate commission. Learn about our Disclosure Policy.