Mobile Commerce

Did Samsung Just Ace Apple Pay?

The competition between Apple and Samsung has just gotten fiercer — this time it’s for the mobile payments grand prize.

Samsung announced yesterday (Feb. 18) that it had acquired LoopPay, a mobile commerce platform that uses its Magnetic Secure Transmission (MST) patented technology to turn existing mag stripe readers into mobile contactless receivers and enables LoopPay digital wallet users to use their LoopPay wallets at more than 90 percent of merchant establishments today. The LoopPay technology was the subject of a “Breakthrough Series” serial in 2014.

As part of the deal, LoopPay founders Will Graylin and George Wallner will be working in collaboration with Samsung’s mobile division on customer loyalty and customer service matters as it relates to mobile payments.

“This acquisition accelerates our vision to drive and lead innovation in the world of mobile commerce. 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,” JK Shin, president and head of IT and mobile division at Samsung, said in a company news release.

LoopPay’s wallet also enables any card with a mag stripe on it, including gift and private label cards as well as loyalty and membership cards. LoopPay’s technology mimics the swipe of a physical mag stripe card, so merchants also pay card present rates for LoopPay transactions.

In December, when news of the potential collaboration was leaked, Graylin said that the mobile payment technology would be implemented in a smartphone sometime in 2015 that would have “massive penetration.” He declined to name the handset manufacturer. We now know that handset manufacturer is Samsung.

We also know that the “collaboration” was plans for an out and out acquisition, an interesting strategic move on the part of Samsung in order to keep the MST technology out of the hands of other handset manufacturers, including Apple, or at least control who gets it via licensing deals.

Prior to the acquisition, Samsung was an investor in LoopPay, along with Visa and Synchrony Financial. Margaret Keane, CEO of Synchrony Financial, said the private label credit card company looks forward to working with LoopPay to help bring mobile payments to its 60 million active accounts.

“Through this deal we can significantly accelerate our mobile commerce efforts. LoopPay’s outstanding leaders and team have deep-rooted relationships with banks, card networks and merchants that will complement those Samsung has established over the years," David Eun, EVP of Samsung’s Global Innovation Center, said in the news release.

Although LoopPay uses mag stripe terminals and technology to enable mobile payments today, Graylin said back in December that the “mystery handset” manufacturer (which we now know to be Samsung) would also incorporate NFC technology, in addition to LoopPay’s magnetic stripe-mimicking technology that allowed users to make payment without opening a mobile app. This technology is made possible via a proprietary internal antenna that can enable payment via either technology, depending on the terminal environment the consumer is interacting with. LoopPay’s MST technology was explained in full detail by Wallner in a recent podcast with MPD CEO Karen Webster.

The mobile payments gauntlet has now been thrown as Samsung and its potential to launch a mobile payments solution that works at virtually all existing merchant terminals without any upgrade and gives it a leg up on rival Apple and Apple Pay. Apple Pay’s NFC technology is available today at ~220,000 merchant locations and only to those who have iPhone 6’s and 6 Plus phones.

Of course, Samsung’s ignition of LoopPay is a function of how many phones it sells with the LoopPay technology embedded in it and how effective it is at getting consumers to adopt it and how quickly that happens. Apple Pay is leaning heavily on its network and issuer relationships to get consumers to register cards to their Apple Pay wallets.



New forms of alternative credit and point-of-sale (POS) lending options like ‘buy now, pay later’ (BNPL) leverage the growing influence of payments choice on customer loyalty. Nearly 60 percent of consumers say such digital options now influence where and how they shop—especially touchless payments and robust, well-crafted ecommerce checkouts—so, merchants have a clear mandate: understand what has changed and adjust accordingly. Join PYMNTS CEO Karen Webster together with PayPal’s Greg Lisiewski, BigCommerce’s Mark Rosales, and Adore Me’s Camille Kress as they spotlight key findings from the new PYMNTS-PayPal study, “How We Shop” and map out faster, better pathways to a stronger recovery.

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