[youtube=https://www.youtube.com/watch?v=bw1l149Rb1k]
On the same day that Apple Pay reached a sign-up rate of 90% of US bank cards by transaction volume, Samsung is reportedly planning to launch a rival mobile payment service that would work with 100% of cards and payment terminals on day one.
Re/code suggests that the company is in talks with LoopPay, a startup which describes itself as “the most accepted mobile wallet on the planet.” Instead of using an NFC chip for contactless payment, LoopPay transmits a magnetic signal which simulates the swiping of the magnetic strip on a card. That means it works with all cards and all payment terminals, contactless or not …
LoopPay currently lacks the security features of Apple Pay – where a single-use code is transmitted in place of the card details – but the company hopes to add a similar tokenization feature later. It is said to be in discussions with Visa, a LoopPay investor, regarding this.
LoopPay works with existing phones by selling a card case or fob which transmits the required signal to the cardreader. If Samsung licensed the technology, it would be able to embed the transmitter into its high-end handsets.
While magstrips are a soon-to-be-obsolete technology, with US banks planning to introduce chip-and-signature or chip-and-PIN cards by next October, the new cards will still have a magnetic strip as a fallback. This means magstrip card terminals will be around for some time, and it’s believed Samsung will be using NFC in tandem, allowing its system to be used with both old and new payment terminals.
The benefit to Samsung is it gets something that works with any card and any terminal, without needing either banks or retailers to sign-up.
While neither Samsung nor LoopPay have confirmed the report, Re/code notes that LoopPay CEO Will Graylin told them earlier this month that the company’s technology would be embedded into a mainstream smartphone in 2015 that would have “massive penetration.”
FTC: We use income earning auto affiliate links. More.
I’m going to barf.
Why? GM is not the only automaker. Why shouldn’t there be more competition in electronic payments.
If you are going to make a car the competes with a Cadillac at least let it be a Lincoln or even better a Lexus or Mercedes. Showing up with a Yugo and a 50 year old engine design simply because it was cheap and easy to throw together is not competition.
Competition over what? 0.05% of a (quiet large) lump of money?
The fragmentation that these various systems will introduce will cause so much more problems than benefits.
Competition is good for consumers. Let the consumer decide.
What Samsung has done is cobble together a bank card emulator that lets the phone look like it has something comparable to Apple Pay that you can fumble around with at the checkout with pictures of credit cards on the screen and their flaky fingerprint reader with none of the real advantages.
@Gregory, competition is not good for customers.
This is a stupid mantra that so many people never grow out of.
While certain monopolies can be bad for customers it does not necessarily mean it is a rule.
What Samsung got here is easy to advertise system. Obviously they will switch to ApplePay knock off eventually – they’ve got fingerprint reader and NFC. It’s only matter of time when they will start using tokenisation. This versatility thing is an easy sell to users who do not care about experience, but rather functionality.
Jurgis, one thing is for certain, if Samsung wants to enter the electronic payment arena it can do so no matter what the anti-Samsungnites thinks.
Barf all you want. Competition is good. Not sure why this is your reaction?
Because, Samsung….
Competition CAN be good. In this case it’s an inferior system that will just cause more confusion for people. Apple Pay is the perfect balance between simple and secure and it’ll work anywhere a contactless payment option is offered. It even works outside of the US if you set up a supported card.
ApplePay vs. Samsung? Will it work?
I just don’t trust my personal info, especially financial info, on a Samsung.
Plus, what’s to keep somebody with a card reader from getting your cards information from your smart phone just like they would from your magnetic strip on a traditional credit card? It seems like it would be pretty easy to compromise this system with a dishonest employee. I’ll stick with Apple pay.
To be fair on this point, if you’re handing out your credit card or swiping it though someone else’s terminal, you’re already exposing yourself to this risk. This would at least hide the credit card numbers.
True. Never trust Shamesung and Crapdroid with any of your info.
When you start calling them names like that, your argument is lost and no one is going to take your comments seriously. Grow up.
I just call them how they deserve.
If you say so, you can not like them, and that’s fine but calling them names, and most likely by someone who has never touched an Android device, is petty and childish.
I worked we many Android devices and I would never want to own one since it’s a total mess.
Sure you have….
Credit card companies and banks are going to push Apple pay for the security measures. They want to get out of the business of fraud liability (or at least lessen it) At some point they will put it to the stores: Either use Apple Pay or cover the fraud if you still want to store customer card data.
Kinda, sorta next October, as mentioned in the article. My understanding is after next October if your card has a chip and the merchant scans the strip (as appears to be the case here), the merchant is on the hook for fraud, not the bank. Most banks have already been issuing chipped cards in preparation. I gather Apple Pay would count as using a chipped card.
That’s correct. It’s the way banks are ensuring merchants will want to invest in new terminals.
Wow. Wireless transfer of magnetic stripe data and no security. Oh, joy! A hacker’s glimpse of heaven!
There is a start up called, “Coin” that sells a similar product. Its a smart credit card that you program to mimic any of your existing cards. Will it work today, sure. Will it work next year when US credit card companies start using smart cards with RFID chips inside them, no. And banks aren’t eager to help Coin out. They won’t be happy with Samsung using an end-around their cards. Regardless, Samsung won’t make a single penny off those charges.
The difference is that Coin SELLS a product but barely ships it. So there’s that.
Welcome to the world of wireless card skimmers….Thanks Samsung
-Signed criminals
In the UK where chip and pin is the norm and has been for years, a lot of retailers won’t allow you to swipe a card at all. I’ve worked in retail and even been instructed to refuse a transaction rather than swipe because of how insecure it is.
This is a bad idea. In the US where you guys don’t seem to care about secure translations, this might be fine, but it won’t be big here, especially as NFC is so widespread.
Translations? I obviously meant transactions
Yep, in the UK we’re trapped in the middle – don’t yet have Apple Pay, can’t use LoopPay.
If you have a US issued bank/credit card from one of the supported vendors you can use Apple Pay in the UK at any contactless payment terminal (which is basically everywhere that has a Chip & PIN reader these days). Of course that doesn’t help if you can’t get such a card lol.
Apparently it’s rolling out early next year from what I’ve read. I’d imagine Barclays will be one of the first given they already support it with Barclay Card in the US.
*BARF*
Are you freaking KIDDING ME??? They proclaim this PIECE OF SH*T to be superior to Pay, or anything else for that matter?! This is even worse than MCX’s dead-on-arrival CurrentC!
Scamming really do have a mental obsession with Apple, and trying to release “me too” products to anything Apple comes out with!
I still say these Korean companies should be banned from rest of the world. They are definitely trying to invade the world using this way, I tell you. I will never use their crap products.
How ironic you talk about a mental obsession…..
You gotta admit, transmitting magnetic swipe info over the air is a pretty ingenious hack for getting a system to work with all card terminals. Combine that with their planned token approach in 2015, and you’ve got a secure system. If anyone should be pissed or worried, it’s the terminal sellers and manufacturers.
Unless you live in a country that doesn’t use swipe transactions. By this time next year swiping should have seen a fairly sharp decline even in the US given the new law for all newly issued cards to be Chip & PIN will be in effect. Give it a few years once everyone’s card has expired and been reissued with a Chip and this kind of service will go the way of the Dodo.
Where do you see in 2015 for that tokenization?
In this day and age everything you purchase should be seen as an investment (obvious to some but you’d be surprised by the sheer amount of people who don’t think this way), people really need to think ahead. I’ll never leave Apple’s ecosystem despite my disappointment in this year’s iPhones.
The competition just keeps following in Apple’s shadow and it’s super creepy. Even when they do something innovative its always in reference to what Apple, these companies have no direction what so ever and are lead by people who are clueless as to how to be relevant with Apple. There is zero value in owning their products.
The problem is I have to open up their app and navigate its UI. I expect to simply be able to use the NFC Proximity and hold the Touch ID sensor and purchase. This is not a superior product in any area that I can see.
Not to mention that there’s no solution for shopping through apps like Apple Pay on iPads.
This fact alone makes it an inferior solution including the fact that you must use a bulky case to use it.
I don’t use cases and even if I did I wouldn’t use one that friggin’ big.
This won’t work with chip and pin so whats the point???
Simulating the magnetic swipe doesn’t help with authorising the purchase though… so presumably the user will still have to enter their PIN (or sign if that still happens in the US) so it is in no way a superior service and is less secure.
That’s right, it can only simulate a magstripe-only card. Using NFC in parallel will allow it to simulate chipped cards too, but without anything like the level of security in Apple Pay where neither your phone nor Apple’s servers have access to your card details.
While ease of use is a necessity (can’t be harder than swiping a credit card, should be easier), that’s not what its about. It’s more about security. Apple Pay minimizes the number of people that ever see your card number, Samsung is just status quo. Apple’s single-use token is all that the retailer ever sees. I no longer want Target, Home Depot, Walmart, Best Buy, Amazon, Walgreens, Safeway, Kroger, and Conoco Oil to see my credit card number. When someone hack’s one of those… the hacker gets all the credit card and Samsung numbers. They get nothing from Apple Pay users. Nothing. That’s what this is all about.
Jim in Boulder
I’ll say this… The only reason I will upgrade my awesome iPhone 5 is to get NFC… On an iPhone :-)
Is this a joke? Most unsecure payment method ever!!! Transmitting full stripe information wirelessly. A card-cloning criminal’s wet dream… Crossing fingers for Samsung to buy this.
And this requires a dongle (not shown) to work. It’s a thing half the size of a credit card (thicker, of course) that plugs into the headphone jack.
Talk about lame, Samsung. Really lame. And even lamer after October when swipe cards will be all-but-gone.
The good thing is that it is compatible with both older payment systems as well as newer NFC terminals. Needs a better name and less chunky hardware, a good try though.
There’s not enough security in this to compete with Apple Pay. The card information is visible during the entire transaction. Now that’s also the case with credit cards but this is going up against something that makes you complete anonymous during the transaction. It’s great that it works with 4S + (I think I heard that right), but the security is basically the same as a normal credit card, so if it’s Apple Pay vs Loop Pay, then Apple win based off security alone.
Will not work in the Netherlands, where all the terminals have there magnet swipe disabled for security reasons! only chip-and-pin and nfc.
I’m puzzled. This is a serious question – not a troll. Is “swipe” disabled in the terminals, or is it that swiping a chip-card is not accepted?
The reason I ask is that we folk in the U.S. have (mostly) swipe cards. And if swipe is disabled for ALL cards then it makes the Netherlands a much harder place for U.S. tourists. I have been able to use swipe cards in Britain and Germany within the last few months but didn’t visit the Netherlands. But plan to next year so I would like to know what I might need to do to prepare.
Have the same question. I’ll add: Italy, Spain, Denmark, Switzerland to the list of countries that also allow swipe, and I’ve never seen a country-wide disabling of swipe.
The UK currently allows swipe as a fallback, but only where chip-and-PIN has been tried and failed.
My primary reason for liking ApplePay is because it takes care of the transaction for me. With ApplePay I don’t have to sign, I don’t have to give some person the back of my phone/case as they walk out of sight for minutes at a time, I don’t have to decide credit or debit, I don’t have to do anything put press my print on my phone for 2 seconds. You can see in ALL of these demo videos that you still have to go through the transactions process. Yeah, security and all that is important… But I love ApplePay for the convenience. This is no where near convenient to use.
It’s ridiculous that US banks are still using the stoneage, unsafe magnetic stripe.
In Europe we are using smartchip cards for many years now.
That obsolete magnetic stripe ist the reason for the worldwide bunch of skimming attacks every day.
Congratulations for the genius decision to upgrade to the long overdue state-of-the-art “safety-upgrade”.
Also not compatible with chip and pin and it sends the magstripe over the air. So lets see if they can make it somewhere near as secure as Apple Pay with tokenization and secure element… but somehow I doubt it.
If it’s anything like Android fragmentation and lack of security, I’ll pass.
“by selling a card case or fob” DOA