Alternative Front
Samsung Pay is setting new records every day in Korea. The cumulative number of registration cards has exceeded 500,000 a month after the launch, and the reuse rate has reached 90 percent.
Based on the success in the domestic market, the service is tapping into the U.S. market on Sept. 28. Samsung Electronics has already secured its partners – the Bank of America, U.S. Bank, Visa Card, and MasterCard. The company has started providing a trial service of Samsung Pay in the U.S. from Aug. 25. According to industry sources, the number of Samsung Pay trial service subscribers in the U.S. already surpassed 500,000.
No concrete schedule has been outlined yet. However, Samsung Electronics plans to expand the service to China and Europe as well. In order to do so, the company is in the closing stage of partnership negotiations with China’s largest credit card firm UnionPay.
Apple Pay has launched a service with a new near field communication (NFC)-powered mobile payment system last year, but it is currently struggling to increase affiliated stores and users. At the same time, Google is expected to release Android Pay in Oct. But with the advantage of being able to be used with existing magnetic card readers, a Samsung Pay official said, “We have already secured more than 1 million stores,” showing confidence in market expansion when unveiling the service early this year.
JP Morgan also said in a report called “It could be a game changer” that only 1 million to 2 million stores, or 10 to 15 percent, in the U.S. have NFC-powered payment systems. So, there are limits for both Apple Pay and Android Pay. Since Samsung Pay can be used in the existing magnetic payment system, Samsung Pay has a decided advantage.
However, Samsung Pay has its own shortcomings. Currently, the service is only available on four devices – the Galaxy S6, Galaxy S6 Edge, Galaxy S6 Edge Plus, and Galaxy Note 5. In a bid to improve it, Samsung Electronics will release Samsung Pay devices at low prices.
An official from the industry said, “Once Samsung Pay is expanded with low-end models, it will spread in all directions in not only the domestic market but also the global markets. Moreover, the effect will maximize that customers stick to Samsung products.”