Samsung may beat Apple to the punch bringing its mobile payment service to the largest smartphone market in the world. According to SamMobile, the Galaxy smartphone maker is set to launch Samsung Pay in China, as well as Spain and the U.K. starting in the first quarter of 2016.
Similar to mobile payment services such as Apple Pay and Android Pay, Samsung Pay uses near-field communication (NFC) technology to enable customers to make in-store contactless payments. But it also has a second trick up its sleeve -- called magnetic secure transmission (MST) -- which can generate a magnetic field to simulate a credit card swipe on payment terminals that don’t support NFC. That second piece of technology was obtained by Samsung when it paid $250 to acquire Massachusetts startup, LoopPay, in February, according to Re/code.
Samsung Pay first launched in South Korea in August, followed by an expansion to the United States a month later. The magnetic technology required to work with the mobile payment service is built into its latest batch of smartphones -- The Galaxy Note 5, Galaxy S6, S6 Edge and S6 Edge Plus. Samsung’s Gear S2 smartwatch also comes with Samsung Pay, but only supports the NFC variant for in-store payments.
Apple Pay, the iOS mobile payment system, also dipped its toes in countries beyond the U.S. and the U.K. On Thursday, it expanded to Canada and Australia -- but only for customers with an American Express card. The service is also expected to reach Singapore and Hong Kong starting in 2016. But eluding Apple is mainland China. While the company wants to bring the service to its second largest revenue market, it still needs to obtain approval from Chinese regulators to launch the service, according to the Wall Street Journal.
In-store mobile payment transactions are expected to total $8.71 billion in the U.S. by the end of 2015, up 137 percent, from $3.68 billion last year, according to eMarketer.