Samsung acquires LoopPay in bid to counter Apple payment system

U.S. startup's tech requires extra hardware for users, but it could be incorporated into Samsung phones

Samsung Electronics has acquired LoopPay, a U.S. mobile payments firm that could help it counter the Apple Pay mobile payments system.

LoopPay produces small add-on devices for smartphones that can transmit credit card information in conjunction with a mobile app. When the devices are held within a few centimeters of a traditional magnetic strip reader, the information can be sent wirelessly to make a payment.

LoopPay's Magnetic Secure Transmission (MST) technology creates magnetic fields that simulate those generated with a magnetic strip, and effectively turns card readers into contactless payment devices without modifications.

The approach differs from that of NFC (near field communication) used in Apple Pay, which requires retailers to have contactless payment terminals that can accept NFC signals.

Massachusetts-based LoopPay claims its solution can work at about 90 percent of point-of-sale terminals in the U.S., which would give Samsung an advantage in mobile payments.

"NFC is currently only available in less than 10 percent of U.S. retailers despite NFC's mobile launch almost a decade ago," a Samsung spokeswoman said via email. "MST solves the merchant acceptance issue that has prevented other mobile wallet solutions from reaching mass adoption."

While LoopPay doesn't require merchants to upgrade their checkout devices, it requires extra hardware for users -- a card or fob, small rectangular devices that can attach to a smartphone either by themselves or in a phone case. Apple's NFC mobile payments technology, on the other hand, is housed in the iPhone 6 and the Apple Watch. Apple Pay also works with apps on certain iPads.

One of LoopPay's products is a US$59 smartphone case that incorporates the card and can also house drivers' licenses and other IDs. The idea is for users to leave their wallets at home, so all they have to carry is a smartphone.

Samsung said LoopPay's executives will work closely with its mobile division, suggesting the technology could be incorporated into Samsung devices. News reports have speculated that its upcoming flagship Galaxy S6 smartphone could have a new mobile payments technology when it is unveiled at Mobile World Congress next month.

The Samsung spokeswoman would only say that "details on device integration" would be announced in the near future.

Apple CEO Tim Cook recently said that out of every $3 spent at stores with contactless payment, $2 was spent with Apple Pay.

Tim Hornyak covers Japan and emerging technologies for The IDG News Service. Follow Tim on Twitter at @robotopia.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags internetInternet-based applications and servicesSamsung ElectronicsLoopPay

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Tim Hornyak

IDG News Service
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Walid Mikhael

Brother QL-820NWB Professional Label Printer

It’s easy to set up, it’s compact and quiet when printing and to top if off, the print quality is excellent. This is hands down the best printer I’ve used for printing labels.

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?