Samsung have just acquired US start up Loop Pay, which gives them instant mobile wallet technology which works anywhere in the world that traditional credit or debit cards are accepted.
The neat thing about Loop Pay is that it works with existing magnetic stripe readers. The downside is that that’s outdated tech and isn’t used for payments in the UK, although it’s still prevalent in the US where they’ve been slower to update physical payment methods.
Loop Pay have figured out how to duplicate the signal given by a mag stripe, they call it “Magnetic Secure Technology”, and transmit it from a keyfob or phone case device without actually swiping a card. Once you’ve stored you cards on the Loop Pay app you can then use your mobile to literally pay at any card swipe machine in the world. Currently Loop Pay requires mobile phone accessories or a key fob to work, it’s expected that with the acquisition by Samsung that the tech will be embedded into future handsets as standard.
What this means for Samsung is that they’ve acquired the technology to build a truly mobile wallet acceptable anywhere that mag stripe cards are accepted and retailers don’t even have to upgrade to chip and pin or NFC for Loop Pay to work. If you consider competitor solutions such as Apple Pay, usage will be limited by NFC adoption by retailers, if a retailer has older point of sale equipment then Apple Pay is useless. Similarly PayPal Here is a cute solution, but it relies on the retailer installing equipment for it to work. Loop Pay has no retailer upgrade requirements to work.
Samsung say that this isn’t just about the ability to enable mobile payments on a mag stripe tech plaform for which the days are numbered. It’s about building a mobile wallet for the future that also works today without requiring either retailers or consumers to update their technology at a pace faster than their willing to accept.