SEOUL -- The world's largest smartphone manufacturer is making a big move in mobile payments. Samsung Electronics Co. Ltd. has agreed to acquire LoopPay, a Burlington, MA-based mobile wallet startup, in a move to rival Apple Pay.
"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, who heads IT and mobile at Samsung Electronics.
Access to the LoopPay app and data is password and PIN-protected; all card data is encrypted.
LoopPay is distinctive in that it turns existing magnetic-stripe readers into contactless receivers without any changes or costs incurred by merchants or their payment processors.
Apple Pay, by contrast, requires POS terminals to be equipped with NFC-chip technology. Retailers have to upgrade their systems to accept Apple Pay, Google Wallet, Softcard and other NFC systems.
Additionally, Walmart, Target, CVS and other large retailers recently formed a consortium called Merchant Customer Exchange to operate their own mobile payments app, CurrentC, while turning off NFC-enabled terminals to block Apple Pay and similar rivals.
LoopPay can store loyalty, gift and other types of cards in the system, which is not currently supported by Apple Pay. However, Apple has already filed a U.S. patent for Apple Pay 2.0 will expand its functions to include coupon redemption, loyalty and ticketing functionality.
What's not yet known is whether LoopPay will continue to work with the iPhone and other smartphones, or if it will become exclusive to Samsung devices.