Mobile payments are the latest trend to be fiercely contested by mobile OEMs with the likes of Apple and Google offering their own mobile payment systems. Samsung introduced its Samsung Pay mobile payments service alongside the Galaxy S6 at Mobile World Congress in February but has been forced to delay the launch until September.
Samsung Pay was meant to launch next month but Bloomberg reports that the Korean manufacturer has had to push the launch back its initial launch plans. In a call to investors today, Samsung Executive Vice President, Rhee In Jong, said the service will launch with the company’s next high-end mobile device, which is expected to be the Galaxy Note 5. While it is initially launching Samsung Pay in the US and Korea, the company has confirmed that it will start rolling out in other markets – including Europe, China, Australia and South America – later this year.
To build its payment solution, Samsung bought LoopPay inc to help develop the technology and built Samsung Pay in conjunction partnership with MasterCard and Visa on the new service. One feature that aims to set it apart from other payment solutions is that it does not require a in-shop contactless payment solution to work and instead, is compatible with 90% of magnetic strip card readers.
Claire Kim, an analyst at Seoul-based Daishin Securities Co, said:
“The new service will likely be deployed on its next Galaxy Note device. The key is how fast Samsung will be able to expand the service to lower-end devices.”
Apple launched Apple Pay alongside the iPhone 6 and iPhone 6 Plus in September last year and since then, it has steadily increased its share of the mobile payments market. Apple Pay is limited to the iPhone 6 and iPhone 6 Plus – along with the company’s first wearable, the Apple Watch – but despite this limitation, the service is close to owning 10% of the market.
Apple Pay won’t be the only challenger to Samsung Pay as last week, Google announced Android Pay during its I/O 2015 keynote. The new payment system will launch later this year alongside its new Android M platform and turns any smartphone application into a wallet that can be used in both physical and online shops. Android Pay will be compatible with around 700,000 stores in the US, allowing it to pose a very real challenge to Samsung‘s aims for Samsung Pay.
Samsung hopes that 15 to 20 percent of its smartphone customers will use the service and as the largest smartphone manufacturer, these targets should help reverse the company’s financial decline. Whether the delay will prove costly remains to be seen but its compatibility with existing infrastructure should certainly be a positive for the Korean manufacturer.