Samsung will buy LoopPay, a mobile payments company.
LoopPay's technology allows mobile payments through traditional magnetic credit card readers. That means it can theoretically work in a lot more places than Apple Pay, which requires special payment pads to work.
Samsung did not say how much it's paying to buy LoopPay.
According to a report last year in Re/code, Samsung plans to incorporate LoopPay's technology in an upcoming flagship phone, likely the Galaxy S6.
LoopPay's CEO Will Graylin confirmed to Business Insider in January that LoopPay would be integrated in a major new smartphone this year. Samsung will formally introduce the Galaxy S6 at an event in Barcelona on March 1.
LoopPay makes cases for popular smartphones like the iPhone with its payment tech embedded inside. It recently released a case for the iPhone 6. LoopPay also makes dongles for your keychain if you don't have a smartphone compatible with one of its cases. There's a metal coil inside LoopPay devices that creates a magnetic field that can "talk" to regular credit card readers.
Because LoopPay works with most standard magnetic credit card readers, it's compatible with far more point-of-sale systems than Apple Pay and Google Wallet, which require special near field communication (NFC) readers. LoopPay claims it works at about 90% of places that accept credit cards.
LoopPay could also be attractive to retailers because it means they won't have to purchase new equipment just to accept Apple Pay.
Here's the full press release:
Samsung Electronics Co., Ltd. today announced that it has agreed to acquire LoopPay, the acclaimed mobile wallet solutions provider that turns existing magnetic stripe readers into secure, contactless receivers. LoopPay’s technology has the potential to work in approximately 90% of existing point-of-sale (POS) terminals, according to internal research, with no investment in new infrastructure required by merchants. LoopPay will join Samsung to strengthen the company’s overall efforts to provide users with seamless, safe, and reliable mobile wallet solutions.
As part of the acquisition, LoopPay founders and veteran payment industry entrepreneurs Will Graylin and George Wallner will work closely with Samsung’s Mobile Division. LoopPay has built an advanced and widely accepted contactless payment solution using its patented Magnetic Secure Transmission (MST) technology. LoopPay’s talent and technology, paired with Samsung’s world leading mobile technology, global presence, and distribution capabilities will help drive the next wave of innovation in the digital smart wallet.
“This acquisition accelerates our vision to drive and lead innovation in the world of mobile commerce. Our goal has always been to build the smartest, most secure, user-friendly mobile wallet experience, and we are delighted to welcome LoopPay to take us closer to this goal,” said JK Shin, President and Head of IT and Mobile Division at Samsung Electronics.
Samsung has an existing relationship with LoopPay, having first identified the potential for the pioneering technology when it became a strategic investor along with Visa and Synchrony Financial. The investment, which was facilitated by Samsung’s Global Innovation Center, helped fuel LoopPay’s MST technology development.
“We are excited to take our relationship with LoopPay to the next level, by bringing consumers a mobile wallet solution that is not just safe and reliable, but also widely accepted at more locations than any competing service,” said David Eun, EVP of Samsung’s Global Innovation Center. “Through this deal we can significantly accelerate our mobile commerce efforts. 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.”
Margaret Keane, President and CEO of Synchrony Financial, the largest provider of private label credit cards in the U.S. and a leader in promotional financing, as well as an investor in LoopPay, commented, “This is great news for our customers who can access their cards and make payments using LoopPay's contactless MST technology. Our goal is to offer valuable products for our clients, service providers, and our customers. We look forward to working with LoopPay and others to deliver secure mobile payment solutions for all of our 60 million active accounts.”
“LoopPay is focused on delivering a digital wallet solution that is dependable for consumers around the world, one that provides more value from card issuers and the merchants that serve them,” said Will Graylin, CEO of LoopPay. “We are excited to join the Samsung family to continue our goal of making smartphones trusted, secure smart wallets and unlock the limitless possibilities of mobile enabled commerce.”
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