LoopPay image 001

Re/code is reporting that Samsung is prepping a response to Apple Pay in the form of its own mobile payment solution that doesn’t require NFC and should support virtually 100 percent of credit cards and payment terminals.

The service should be announced sometime in 2015 as the South Korean giant is reportedly in talks with the Burlington, Massachusetts based mobile payments startup LoopPay about possibly incorporating their technology into its wireless mobile payment system.

Writer Jason Del Rey has learned from sources that ”a prototype of the payments system working on a Samsung phone has been created,” with one source cautioning that the deal could still fall apart as it’s unclear whether or not Samsung has actually negotiated a deal with LoopPay.

For what it’s worth, Samsung’s existing fingerprint identification technology on the latest Galaxy phone should be tied with the new payments system. Currently, Samsung’s fingerprint-based identification is limited to stores that accept PayPal.

According to their website and Kickstarter page, LoopPay is the most accepted mobile wallet on the planet.

The LoopPay CardCase, pictured above, and the LoopPay app support thousands of credit, debit, loyalty, gift, rewards and private label cards. The technology supports virtually any payment terminal in use today and, unlike Apple Pay, doesn’t require NFC.

https://www.youtube.com/watch?v=bw1l149Rb1k

The LoopPay CardCase works with the iPhone 5, iPhone 5s, iPhone 6 and iPhone 6 Plus, as well as with Android smartphones. As a bonus, the case provides up to 60 percent additional power for the iPhone 5 or iPhone 5s.

They’re also selling the Loop Fob, a small audio jack device for iOS and Android seen below that has a built-in card reader to safely store credit cards encrypted into a secure memory module.

LoopPay image 002

The accessory has a magnetic induction loop to transmit your card data to just about any merchant card reader. Apple Pay does not store or transmit credit card data on the device and instead relies on secure one-time tokens generated on the fly and stored in its own Secure Element.

The LoopPay vs. Apple Pay comparison page at the company website claims LoopPay is at 5,000+ banks and issuers compared to Apple Pay’s ten major banks.

“LoopPay account follows you and is not tied to one device maker,” says the startup, adding that Apple Pay is available in 220 thousand retail locations in the U.S. while LoopPay is accepted at over ten million retail locations.

LoopPay vs Apple Pay image 001

LoopPay owes its ubiquity to the fact that the underlying technology mimics a card swipe, but that could also be its downfall once U.S. merchants upgrade their payment terminals to NFC hardware and adopt token-based system popularized by Apple Pay and Google Wallet.

In a nutshell, tokenization prevents attacks stemming from credit card data being hijacked either individually during the payment process or in bulk, by breaking into merchants’ poorly secured databases.

That’s because each token is matched up with a specific credit card account by a card network or bank. As a result, a merchant never gets to receive or store the actual payment information to begin with, which is exactly how Apple Pay operates.

On the other hand, LoopPay’s CEO told Re/code that a partnership with Samsung would allow payment information to be transmitted to the merchant via NFC technology embedded into some Samsung phones, in addition to its own magnetic stripe-mimicking technology.

“Users would not have to open up an app to transmit their payment,” he added. Still, any advantage LoopPay has in terms of its compatibility with traditional payment terminals could be easily erased as swiping gets phased out over time in favor of NFC and the chip-embedded cards.

For the time being, LoopPay “hopes” to use tokenization in the future and has reportedly discussed the possibility with Visa, which is an investor in LoopPay.

Meanwhile, Apple Pay now supports cards that represent about 90 percent of the credit card purchase volume in the United States, an increase from the 80 percent mark when the service launched two months ago.

And for the sake of completeness, I should point out that The Wall Street Journal said today that Google is looking to jump into online commerce by adding a Buy button to its Shopping app for iOS and Android.

[Re/code]

  • Jason Baroni

    Samsung is ridiculous.

    • Dan

      How so? They didn’t invent LoopPay, they are simply making (possibly) a deal with them.

      • Jason Baroni

        Every time Apple come up with something they just work on the same base service or product to compete against Apple’s. I mean, nothing wrong with that, but their lack of innovation is depressing.

      • Dan

        You are aware that Apple is not the first to implement NFC payment right?

      • Jason Baroni

        Of course I am. Apple doesn’t invent things, but UIs. Take it easy, I am not some fanboy that simply knocks off other companies to prove something that is not real.

      • Dan

        I am taking it easy. I’m not a Samsung fanboy. I simply do not agree with the ‘ridiculous’ comment for the reasons stated above.

      • Dan

        That’s hardly depressing, that’s business. Apple didn’t have NFC nor ‘phablet’ phones before, now they do. In this day in age, it’s hard to come up with anything ‘new’. Companies borrow from eachother. As consumers, we just need to choose which side offers what we want.

      • Jason Baroni

        Yes, I totally agree with you. The point that I don’t like what Samsung does is related to their business formula to take the market. Apple doesn’t use the NFC itself like the others, for example. They brought it to the iPhone only because the Apple Pay, a solution they didn’t invent that now works better than ever, thanks to them. You can note it down: Samsung’s payment service will be like that motion interactions the S4 came up with. No one will make use of it at all. It hapenning, you will see the problem is not the product, but how Samsung teaches the user to get the most of it. I give you another example. Motorola came up with something genius: to give the market great technology for cheap prices, here we have the Moto G. It is a game changer not because what it does (since it isn’t a gimmick afterall), but because of its price tag. People deserve good technology for less money. They didn’t simply made something that their competitors make to compete.

    • Domodo

      This is actually great news for consumers. Not only does this create more competition, but it pushes things forwards when it comes to payments by bringing the service and the new way of paying to more people.
      Looks like reason and logic aren’t welcome on fanboy blogs. Be objective for once. At least try because the only thing ridiculous here are the comments.

      • Jason Baroni

        I am actually tired to justify why they are so ridiculous, but let’s go.
        First, every time Apple invents something, they work on the same category product or service to beat Apple’s. Second, pushing low class features to their thousands of phone is not the answer to get on Apple and any other company. Third, because they still make ads to annoy Apple’s customers, what is disrespectful and Marketing wise wrong.

      • Domodo

        1) You are most certainly not a marketing expert. Any advertisement that boosts their profit is everything but wrong. Also, business is amoral, there is no good or bad.
        2) Apple hasn’t invented anything. Including the iPhone. Introducing gradual changes is not inventing. For example, buying multitouch technology is NOT inventing multitouch technology.
        3) Working on the same category of products is called competing. I know that term is unknown in your Apple universe. That is the only reason we now see 4″+ iPhones, even though Apple made ads describing how far our thumb can reach. Not to mention the notification center, control center, frontal camera, large capacity battery, etc., etc….
        4) Pushing their “low class fearures” is a great answer and their profits and marketshare prove it.
        Come up with an actual argument instead of appealing to emotion and how Samsung huwt youw feewings.

      • Dan

        I agree, competition is far from ridiculous, but some people just don’t get that.

      • Jason Baroni

        1) Wait. I am not a CEO, but yes, I have some Marketing
        Expertise, otherwise I wouldn’t be working for 4 big companies as a Marketing
        advisor being 20′ old. But this is not about me and my professional
        background.

        Marketing is about values, and if you don’t have it,
        it is a waste of time try to compete in a world dominated by Branding, what
        Samsung can’t even work on. Marketing knowledge is pretty questionable
        when you demand a ‘revolution’ year by year from a product that was
        revolutionary by itself.

        2) Apple hasn’t invented any product, indeed, but they
        have been a game changer for every category of products that they re-invented.
        Mind you that Apple states they don’t enter in a Market that they don’t know
        *cof cof Google, cof cof Samsung*. What Apple did invent was new ways of
        interaction, such as the clich wheel and now the Apple Watch UI, some
        breakthrough hardware and software combined.

        3) You don’t need to follow others to compete, here is an
        example: the iPod. For the latest years the iPod have competed with low cost
        smartphones, and still it has sold more than many, many low cost phones. It’s
        an indirect competition, but it is still a competition, since customer can buy
        anything with their money, being billions of candies or a car, for example.

        4) Pushing low cost features to new high and phones is
        such a waste, and Samsung has proving it with Galaxy S5 sales. I don’t know,
        for example, people who makes any use of heart rate monitor, since I only have
        seen light users, and just a few of them. Your customer buys your product, but
        they don’t care and for what’s worth, they can’t even notice these gimmick
        features. So, something is wrong. The iPhone 5c with all the limitations outsold
        the Galaxy S5 in Europe and Latin America at the same market time, and if you
        look at BRICs economy pricing you will see they have almost the same price.

  • Merman123

    lol

  • ClaudieX X

    NEWS FLASH!! Samsung have in their hands, the times at which Tim Cook goes to the bathroom and applies as obligation for all members of the company…

  • Brandon Piening

    Apple needs to bring Apple pay to Australia, we have nfc (almost literally) everywhere with the chips built into cards already
    Apple pay would be easier than keep a credit card under a phone case or in a wallet case, not by much but honestly everyone with an iPhone 6 would use it.

  • romeodesigns

    The music is always motivational and happy, but It still doesn’t make me want to put my entire life, my entire funds and all my loyalty cards into one easily accessible place. I can choose to take cards out of my actual wallet, but if you do here you’ll have tog re-enter them back.
    Going back to the other entry that Sebastian wrote about the license in your phone, imagine if the police had your phone?
    Technology is technology and I respect the advancements it’s made, but I think im going old school on this one.

    • Just an FYI but cards can be cancelled and new cards issued. Sure it’s a gigantic pain but for the convenience gained it’s probably worth it.

  • nyangejr

    Let the games begin ….. – i like that ending line in “Dracula Untold”

  • Casey

    Too bad it’s not secure. Tons of credit card theft happens via magnetic skimming and this still allows that. It’s no more secure than plastic. Apple Pay on the other hand uses technology to make everything secure, not simply backwards compatible.