Samsung Electronics Co. is acquiring LoopPay Inc. to gain a bigger toehold in mobile payments, a market that’s already luring its main rival Apple Inc.
LoopPay makes smartphone accessories that let 90 percent of credit-card payment devices accept mobile payments, Samsung said in a statement on Wednesday. While Samsung’s top-of-the-line devices have the wireless technology necessary for mobile payments, LoopPay makes it easier for retailers to accept payments via smartphones, including older iPhone models. Samsung didn’t disclose terms of the deal.
Apple is promoting its own technology, called Apple Pay, as a way for owners of the iPhone 6 and 6 Plus to pay for goods and services. While people may have smartphones that can be used as mobile wallets, not all stores have specialized terminals that can accept such payments. Still, the platform is starting to gain ground, with the White House announcing last week that Apple Pay will be enabled for U.S. federal-payment card users.
“Mobile payment is still a very nascent market and share is still up for grabs since the market is still so young,” said John Butler, a Bloomberg Intelligence analyst. “Given Samsung’s size and their brand name, they can leverage the brand to build awareness of LoopPay.”
Other companies competing in mobile payments include Google Inc., with Google Wallet, and EBay Inc.’s PayPal. While some of LoopPay’s accessories work with iPhones and smartphones running Google’s Android software, it wasn’t clear how the Samsung acquisition will play out in terms of compatibility.
“This acquisition accelerates our vision to drive and lead innovation in the world of mobile commerce,” Shin Jong Kyun, president and head of the IT and Mobile Division at Samsung Electronics. “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.”