Samsung wants to win the mobile payment war with Apple at any cost
Samsung is rightfully envious of Apple’s mobile payment service Apple Pay, which has swept the mobile payments world since being introduced at the end of 2014. With that in mind, it’s introduced its own “Samsung Pay” rival service, which it hopes will sway customers back in the South Korea tech giant’s direction.
But with Apple having both a lead-time advantage and the “halo effect” of a beloved brand behind it, Samsung’s trying to appeal to something a bit more base when it comes to swaying people in favor of its mobile payment service: cold, hard cash.
According to new reports coming out of Korea, the company has decided not to collect fees on Samsung Pay, rather than the 0.0015 percent demanded by other mobile payment services. Samsung allegedly won’t charge partnered credit card companies either, or from service providers for online payments.
In short, Samsung will forfeit the chance to rake in cash by taking a longer-term view based on becoming the main mobile payment company. Instead, it may look for other ways to monetize the service, such as including ads “by issuing coupons or gift cards,” according to the company’s vice president Lee In-jong.
Samsung Pay already has one potential advantage over Apple Pay in that it doesn’t require that stores upgrade their pay terminals so that they use NFC (Near Field Communication) as Apple Pay and Google Wallet do, since Samsung’s technology transforms existing magnetic stripe readers into contactless receivers.
While the decision to waive mobile payment fees will reportedly affect Samsung’s stomping ground of South Korea first, it is expected that the same strategy ll be used as the service rolls out to other markets, including the U.S.