Samsung is making its foray into the mobile payments market, lining it up for yet one more head-to-head battle against Apple.
This time, the Korean tech giant is taking on Apple Pay as it acquires LoopPay, a mobile commerce platform and contactless digital wallet provider boasted to be accepted by 10 million merchants, or 90 percent of retail locations, nationwide.
LoopPay co-founder and CEO Will Graylin confirmed the news in a memo on Wednesday. Graylin wrote:
Our vision of inspiring consumers to transition from a physical wallet to a truly digital wallet will continue. I'm most excited that Samsung shares this vision and has chosen to help change how we shop and pay for goods and services. We look forward to working with Samsung to offer the world's most secure and compelling mobile platform.
Financial terms of the agreement have not been disclosed.
When the deal closes, LoopPay will become a wholly owned subsidiary of Samsung Electronics America. LoopPay's team will continue to work independently from its existing Boston headquarters.
LoopPay launched out of Kickstarter as a mobile payments solution aimed at the masses as a more consumer-friendly (and easier-to-use) option than Apple Pay or Google Wallet.
Supported on both iOS and Android mobile phones, LoopPay's patented technology Magnetic Secure Transmission effectively "turns in-store payment terminals where you normally swipe a credit card into contactless readers."
Customers pay for purchases by pressing the button on the LoopPay device -- or open the LoopPay app and select the card of his or her choice to tap and pay. Customers must tell the merchant which card is being used for payment, at which point the customer just places the LoopPay device against the reader where one would normally swipe to pay.
Merchants don't need any extra hardware to accept LoopPay payments. Customer data is encrypted, and the LoopPay app is locked by a PIN number and password.
LoopPay made the rounds at the 2015 Consumer Electronics Show, flaunting a new iPhone-friendly cover dubbed CardCase.
Snapping onto the smartphone like any other cover, CardCase also sports a storage compartment for an ID and backup LoopPay card.
Speculation about talks between Samsung and LoopPay have been on the fringes since December, with Re/Code reporting an integration was being primed for the Samsung Galaxy 6 smartphone, expected to debut at Mobile World Congress in Barcelona this March.