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What is LoopPay? How Samsung will take on Apple Pay

Samsung has purchased LoopPay. Here’s why this is big news for mobile payments on future Galaxy smartphones

It might be too late to make an appearance in the Galaxy S6, but Samsung’s decision to acquire a mobile payment LoopPay suggests it has plans to give Apple Pay a run for its money..

So what will LoopPay bring to the payment party? We take a look at why the innovative startup could be a good fit.

What is LoopPay?

LoopPay as it stands, is a US-based mobile wallet solution. It incorporates an iOS or Android smartphone app, and a number of stand-alone LoopPay devices.

The app securely stores all of a user’s payment details, as well as loyalty and gift cards. You can then either use your NFC-equipped smartphone to make payments directly, or use one of the LoopPay devices.

There are four flavours of these LoopPay device. These devices include the LoopPay Fob, ChargeCase, Card, and CardCase. As the picture below demonstrate, the LoopPay ChargeCase and CardCase act as cases for a range of smartphones, with the LoopPay technology (and space to hold a backup card) incorporated.


So what makes it different to other solutions?

Of course, the world is littered with stalled or stalling mobile payment solutions. What made LoopPay different enough for the world’s biggest tech company to take a punt on it?

The answer is LoopPay’s uncommon adaptability. It works in most shops where there’s an NFC payment system, but it also works with more traditional payment systems thanks to the ability of those dedicated LoopPay devices to mimic old mag stripe technology.

You just hold them up to the card swipe mechanism, press the approval button, and the payment will be made.

This fact alone looks to solve (at least partially) one of the biggest obstacles to mobile payment success so far – a lack of retail support. By eradicating the need for most shops to upgrade their equipment, the potential is there for LoopPay to become a widely used standard in a way that even Apple Pay can’t match right now.

Apple Pay

Just how widespread are we talking here?

According to a joint press release, LoopPay’s tech “has the potential to work in approximately 90 per cent of existing point of point-of-sale terminals.”

So, far more widespread than any other mobile wallet solution out there, then.

MORE: Apple Pay: What you need to know about iPhone and Apple Watch payments

How does LoopPay work with card swipe machines?

LoopPay fools old school mag stripe systems by emulating the same magnetic field change as you’d get from a mag stripe card being swiped through it.

It does so using MST technology, which generates changing magnetic fields over a very short period of time. It puts an alternating current through an inductive loop, which is then picked up by the magnetic read head of the card reader.

The LoopPay device mush be within three inches of the magnetic read head, and the field generated only lasts during the transmission period initiated by the user.

In other words, it’s very local, and it’s very safe.


What will Samsung do with LoopPay?

The LoopPay team will join up with Samsung Mobile to “drive the next wave of innovation in the digital smart wallet,” which means that you can bet it will be integrated into future Samsung smartphones, tablets, and smart watches.

Indeed, Samsung itself has virtually confirmed as much. “Through this deal we can significantly accelerate our mobile commerce efforts,” said Samsung mobile boss J.K. Shin. “LoopPay’s outstanding leaders and team have deep-rooted relationships with banks, card networks and merchants that will complement those Samsung has established over the years.”

The exciting thing here is that Samsung isn’t just looking to match Apple Pay – it’s looking to better it. By integrating such an open, inclusive system, it has the the real potential to marginalise Apple’s own limited, hardline payment system.

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