Samsung Pay predicted to clinch early lead against competitors
Samsung announced its mobile payments service back in March, so far the company has not confirmed when Samsung Pay will go live, only that it will initially be available for customers in the United States and South Korea. We did report recently on the possibility of Samsung Pay going live by September this year and so far the company has not said anything on the contrary. A new report predicts that due to its unique technology Samsung Pay might be able to clinch an early lead in the mobile payments segment as opposed to its competitors which include Apple Pay and Android Pay.
A major obstacle that prevents mobile payments from taking off has to do with merchants not rapidly upgrading to terminals that support these new technologies. Services like Apple Pay and Android Pay require merchants to have near field communication or NFC terminals in order to accept payments and while merchants are upgrading to new terminals it’s not happening fast enough, obviously there’s a cost involved and many merchants particularly those who work on a small scale are not willing to invest in them.
Samsung worked around this problem by acquiring a company earlier this year called LoopPay. The company developed a technology called Magnetic Secure Transmission or MST which Samsung Pay relies upon. This eliminates the need for NFC terminals and lets merchants accept payments using their existing credit card readers. Moreover, Samsung Pay will also allow users to pay by simply presenting a barcode which can be scanned at checkout. This means that Samsung’s mobile payments service will be readily available at almost all merchants across the United States, and even in South Korea for that matter. This is one of the reasons why BI Intelligence reports that Samsung Pay is going to play a major role to drive mobile payments in the US to more than $800 billion by the end of 2019.
