Sources have revealed that Samsung spent approximately $250 million to acquire LoopPay and gain access to their mobile payment technology. LoopPay technology is unique amongst mobile payment solutions because it can take advantage of existing credit card readers that use the magnetic stripes on the back of cards. Most other solutions rely on NFC to make the connection, meaning retailers need special equipment installed. By making use of hardware that is already widely deployed, Samsung hopes their solution using the LoopPay technology will help them compete against Apple, Google and PayPal.
Prior to Samsung’s acquisition, LoopPay had raised a little more than $10 million from investors. Thus, the payout from Samsung is several orders of magnitude larger than their previous efforts. Although details are not available, sources also indicate the Samsung investment could increase even more based on performance resulting in additional earnouts.
LoopPay’s technology will eventually be rolled in with the forthcoming Samsung Pay mobile payments solution. Samsung Pay is scheduled to be deployed in some markets, including the U.S., later this year. Initially the solution will be available on the Samsung Galaxy S6 and Galaxy S6 edge, including full support for the LoopPay technology. Samsung has not revealed whether or how they may make Samsung Pay available on older devices that will not have the magnetic card reader support.
source: Re/code
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