It looks like the new Galaxy S6's will not be the only exciting news announced at the Mobile World Congress (MWC) in Barcelona from Samsung. The company has just announced their new Samsung Pay to combat the increasingly popular Apple Pay. JK Shin, CEO and Head of IT & Mobile Communications Division at Samsung Electronics said, "Samsung Pay will reinvent how people pay for goods and services and transform how they use their smartphones. The secure and simple payment process, coupled with our robust partner network, makes Samsung Pay a truly game-changing service that will bring value to consumers and our partners in the ecosystem."
Samsung has vowed to deliver a best-in-class mobile payment solution and has teamed up with major payment networks such as MasterCard and Visa. They also expect to expand their partnership ecosystem with American Express, Bank of America, Citi, JPMorgan Chase and US Bank – giving greater flexibility and access. Jim McCarthy, Executive Vice President, Visa Inc. said, "Mobile commerce just got a lot more interesting. Combining Visa's expertise in payment technology with Samsung's leadership in creating innovative mobile experiences, gives more choice to financial institutions who want to enable their customers to pay by phone."
Although acceptance of mobile wallets have been extremely low with retailers that utilize the magnetic swipe terminals, Samsung Pay will allow customers to use their devices at those existing terminals – either by using Near Field Communication (NFC) and a new proprietary technology called Magnetic Secure Transmission (MST). This one-two punch will make Samsung Pay more accessible to both merchants and consumers than in the past. With MTS, about 30 million merchants worldwide with can potentially accept Samsung Pay regardless of whether the POS terminals support NFC or traditional magstripe. MTS technology enables Samsung Pay to support private label credit cards (PLCC) because of cooperation with Synchrony Financial and First Data Corporation.
Margaret Keane, President and CEO of Synchrony Financial, the largest provider of private label credit cards in the US, noted, "This is great news for our customers who can access their cards and make payments using Samsung Pay and great news for our retailers who won't have to upgrade their point of sale terminals. We look forward to working with Samsung and others to deliver secure mobile payments for our 60 million active accounts."
Samsung claims that Samsung Pay is easy to use – setup a new card in a couple of easy steps – and will lead to a positive customer experience, especially with the new fingerprint sensor on the new Galaxy S6's. Samsung claims they will keep no personal data or hold any account numbers on the smartphone and combined with tokenization – which replaces sensitive card data with a unique and secure 'token' – fraud is virtually eliminated. Samsung Pay will initially be available in the US and Korea this summer and the expand to other regions, including Europe and China.