Can Samsung and LoopPay usher in the age of the digital wallet?
ApplePay might be grabbing all of the headlines but there's a good chance that by the end of the year it's Samsung's digital wallet that's getting all of the plaudits.gadgets Updated: Feb 20, 2015 13:22 IST
ApplePay might be grabbing all of the headlines but there's a good chance that by the end of the year it's Samsung's digital wallet that's getting all of the plaudits.
As popular as ApplePay is proving to be as a digital alternative to credit cards and cash, its use is still very limited. Not just because it only appears as a feature on three iPhone models (the 5s, 6 and 6 Plus), but because only 8% of major US retailers accept it as a method of payment.
By the end of the year, if the buzz keeps building, then that figure is expected to jump to just over one third (38%) of major shops an stores.
However, by acquiring digital payments start up, LoopPay, Samsung is about to integrate a mobile wallet system into its handsets that the vast majority of US stores, big and small, are already set up to accept.
Speaking to TechCrunch about the company's decision to buy LoopPay, EVP and head of Samsung Mobile
Dr. Injong Rhe said: "If you look at other competitor solutions in mobile payments [Apple Pay included], it's actually based on near-field technology, which has very limited coverage in the U.S. We see the MST technology that LoopPay owns has a lot of potential to really solve the end-user coverage issues with respect to point-of-sale terminals."
This MST technology essentially creates a digital substitute for the swipe of a magnetic strip on a traditional credit card and beams it to a point of sales terminal. So, if a store accepts credit cards, it will also theoretically accept LoopPay.
Although fishing a smartphone out of a pocket can be much simpler than searching around for a wallet or sorting through coins when at the checkout, cards and cash work perfectly well.
Therefore, a digital wallet will have to offer more than just a simple way of sorting through debit and credit cards if it truly going to be a hit with consumers.
Although ApplePay only launched in October 2014, it has proven popular partly because of its focus on security; Apple doesn't collect user data and payment are validated via fingerprint scan. However, it also ties in with Paybook, an existing Apple app for automatically storing and sorting everything from concert and airline tickets to rewards cards and coupons.
Samsung and LoopPay are both aware that accessibility is only part of the problem and that it will take something more before consumers are really sold on the concept.
But we won't have to wait long to see what Samsung has planned. On March 1, the company will be unveiling its latest flagship handset, the Galaxy S6 and it is expected to be the first device from the company with LoopPay's technology built in.
First Published: Feb 20, 2015 12:22 IST