Even a quick Samsung Pay expansion to China, Europe may not help uptake

Look for a September Samsung Pay to debut in the U.S. and South Korea with other regions to follow. Facing both Apple Pay and Android Pay does Samsung have a chance?
Written by Kevin Tofel, Contributor

Samsung knows that it if wants its own digital payment service to be competitive, it can't wait long to expand Samsung Pay around the world. The company will follow a U.S. and South Korea launch with Samsung Pay in China and Europe, it said on Wednesday.

Samsung Pay will debut around September and coincide with the launch of a new flagship phone. I suspect that phone is the next Galaxy Note, given that the Galaxy S6 -- see our review here -- and S6 Edge handsets are relatively new.

There's pressure to get Samsung Pay moving forward quickly and even a September launch puts the company behind. Apple Pay has a head start, for example, and Google last week announced Android Pay will be broadly available in Android M. Both Apple Pay and Android Pay are supported by 700,000 retail locations in the U.S.

Samsung's ace in the hole might be its February purchase of LoopPay.

Samsung already supports NFC, or near field communications, payments but the addition of LoopPay can expand the locations where Samsung Pay is accepted. LoopPay uses short-range magnetic fields to simulate the data stored on the stripe of a credit or debit card. It can be used, then, at locations that don't offer tap-to-pay services.

There is still an open question of how LoopPay's technology will work at chip-and-PIN terminals, which the U.S. is transitioning towards. In Europe and other parts of the world, this payment method is widely available already. LoopPay has previously said it has a solution for this scenario although it hasn't yet announced what that is.

A quick expansion of Samsung Pay will surely help the company: More locations offers more potential usage.

I still think Samsung is facing a challenge however. It doesn't have first-mover status and once Android Pay is widely adopted by Google's hardware partners, Samsung Pay has little else of value to offer.

Samsung Galaxy S6: Image gallery

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