The Korean technology giant has announced that it will enter the mobile payments arena with Samsung Pay.
Samsung revealed the new system at a press event in New York on Thursday. The system is contactless and will work with the familiar credit card readers present in most shops and businesses.
Welcome to our latest issue of ValueWalk’s hedge fund update. Below subscribers can find an excerpt in text and the full issue in PDF format. Please send us your feedback! Featuring investors exit long-short hedge funds, the oil market is now "broken", and Haidar Capital surges 225%. Q2 2022 hedge fund letters, conferences and more
Samsung to take on Apple and Google
The system will allow users to purchase items in physical stores using just their smartphones. However unlike Apple Pay and Android Pay, which use Near Field Communication sensors to process purchases, Samsung Pay will employ a technology known as Magnetic Secure Transmission.
One advantage of this system is that the technology communicates with the magnetic strip reader found in credit card terminals in many shops. In contrast, Near Field Communication sensors require special point-of-sale systems that are not yet widely distributed.
Customers are asked to provide a fingerprint to confirm their purchases, which are processed as they place their phone next to a point-of-sale system at the checkout. “It is easy, safe, and most importantly, available virtually anywhere you can swipe a card, in most cases without new costs for merchants, from day one,” said JK Shin, CEO of Samsung’s mobile division, in a release.
Planned roll out starts August 20 in Korea
The new Samsung Galaxy S6 Edge+ and Galaxy Note 5 smartphones will feature Samsung Pay straight out of the box, and owners of the Galaxy S6 and S6 Edge will be able to download the system for free.
Korean users will be able to get the app from August 20 onwards, and U.S. users from September 28. The app will roll out later in the U.K., Spain and China.
Partnerships are already in place with major credit companies American Express, Visa, Mastercard and Discover, in addition to agreements with Chase, Bank of America and U.S. Bank.
Alongside Samsung Pay, the company also released details of a new smart watch, the Gear S2. In contrast to the square-faced Apple Watch, Samsung has made its next generation smart watch round, and it looks like a sleekly packaged device on first look.