During its recent Unpacked event this year, Samsung officially announced that it will be launching its own mobile payment system, Samsung Pay, in the United States in September 28th of this year. Samsung Pay is the South Korean mobile giant’s answer to Apple Pay, the system developed and launched by Apple last year.
Both competing mobile payment systems actually function similarly. Like Apple’s system, Samsung Pay allows mobile users to pay for items bought using their smartphones, and merchants can add support for Samsung’s system pretty easily. Samsung Pay utilizes near field communications (NFC) technology and combines it with fingerprint authorization and digital tokenization in letting merchants authenticate the user’s credit card. It also helped that Samsung acquired LoopPay back in February of this year, and then made full use of the firm’s expertise in mobile payment systems in fashioning a contactless mode of payment of its own.
Samsung actually already started deploying (testing phase) its mobile payment system in its home country, South Korea, in July earlier this year (it goes live on August 20th). Next month, it will be made available to American consumers. As for merchants in the US, if they already have support for other NFC based systems like Apple Pay and Android Pay, they should be able to add support for Samsung Pay as well.
By acquiring LoopPay, Samsung also was able to adapt a special feature that allows users to pay with their smartphones even with regular card readers, which can work even without NFC technology. This feature will also be present in Samsung Pay. All the mobile users need to have is a Samsung device that can scan fingerprints, which includes the Galaxy S6, the Galaxy S6 Edge, as well as the newly unveiled Galaxy Note 5 and Galaxy S6 Edge+ phablets.
There is one aspect however that Samsung needs to take care of in order for its Samsung Pay mobile payment system to really take off. And that is the banking and payment processing side of things. Apple, with its brand power and clout, managed to get several banks and financial institutions under its fold for Apple pay, but even after many months since its release, its list is still a bit limited. Samsung Pay will undoubtedly go through the same challenge.
And even if Samsung Pay is yet to launch in the US, it is never too early for Samsung to start making expansion plans. Europe, of course, is the obvious next target. Apple Pay has already landed in the United Kingdom last July, which means that Samsung has a lot of catching up to do. If it can beat Apple in the Eurozone, that should give Samsung a significant advantage over its rival.
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