The mobile payments space has just heated up following Samsung’s announcement of its new “Samsung Pay” technology.
The South-Korean company made the announcement at Mobile World Congress in Barcelona on 1 March alongside its new Galaxy S6 and Galaxy S6 Edge flagships, which will be the first Samsung devices to use the technology.
Samsung has collaborated with MasterCard and Visa on the tech that will enable holders of the cards with a new Samsung device to make transactions in-store with their mobile phone – similar to Google Wallet and Apple Pay.
“Samsung Pay will reinvent how people pay for goods and services and transform how they use their smartphones,” said JK Shin, CEO and head of IT & mobile communications division at Samsung Electronics.
“The secure and simple payment process, coupled with our robust partner network, makes Samsung Pay a truly game-changing service that will bring value to consumers and our partners in the ecosystem,” he added.
But the advantage that Samsung has over Google and Apple is that these companies use near-field communications tech to make contactless payments in shops that have newer payment terminals. Although Samsung also uses this, it has incorporated an additional technology called Magnetic Secure Transmission following its acquisition of LoopPay last month. This technology allows consumers to use a traditional card swipe reader by holding their phone up to the device, opening up the technology to consumers in areas that do not yet have the newer chip-and-pin and contactless payment systems.
“Mobile commerce just got a lot more interesting,” said Jim McCarthy, executive vice president, Visa Inc.
“Combining Visa’s expertise in payment technology with Samsung’s leadership in creating innovative mobile experiences, gives more choice to financial institutions who want to enable their customers to pay by phone,” he added.
“We are committed to making interactions easier in the financial lives of our customers,” said Brian Moynihan, CEO, chairman and director of Bank of America. “Samsung Pay is another significant move in that direction for our 17 million mobile customers.”
In a company statement, Samsung said that it is working hard to “expand the partnership ecosystem for Samsung Pay with key financial partners globally,” including major financial firms such as American Express, Bank of America, Citi, JPMorgan Chase, and U.S. Bank.
Samsung also made sure to reassure those worried about security, stressing that it will not be keeping personal account numbers on a consumer’s device in addition to providing other features that will make the technology safer than using a physical card.
