Samsung has been named the premier partner for Visa’s new Ready Partner Program. The program, which was announced on Friday, is aimed at enhancing the approval and licensing speed of Visa-endorsed payment systems on different devices like smartphones.
Through Samsung, Visa Inc (NYSE:V) will have a chance of realizing its mobile payment ambitions on a global scale.
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Under the partnership, Samsung will incorporate Visa’s PayWave mobile payment application in its future mobile devices. In addition, Samsung will use Visa Inc (NYSE:V) to link its customers’ phones to Visa accounts and other financial institutions. A well placed source familiar with the partnership said that the Galaxy S4 would be the flagship product for Visa’s new initiative.
Bill Gadja, the head of Visa’s mobile products, described the partnership between Visa and Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930) as a ‘global alliance’. “We’re looking forward to announcing more programs with Samsung,” he added.
A win-win situation
Going by the dynamics of the partnership deal, it should be noted that the deal presents an win-win situation. Both Visa Inc (NYSE:V) and Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930) are poised to gain notably in the event that the deal pans out well.
The mobile payment trend has still not caught on as expected in the U.S and other mature markets. Nonetheless, Visa’s prolonged efforts in establishing a digital wallet have allowed it to make some notable inroads into the American market. According to the Kantar report, which we wrote about earlier today, Android driven Samsung smartphones are argued to be leaders in the U.S. market. As such, the partnership deal is likely to enhance Visa’s U.S. footprint in a notable fashion
One of the big challenges as far as mobile payments goes has been getting the necessary connection technology called near-field communication. Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930) was one of the pioneering tech leaders to get the technology in its phones. On the other hand, Apple Inc. (NASDAQ:AAPL), Samsung’s biggest competitor in the U.S. and arguably worldwide, does not have NFC. Samsung therefore gives Visa a better entry point into the potent U.S. market.