Over the years, the primary modes of consumer payments have undergone a number of changes. Cashier’s checks once accounted for 86% of noncash transactions, recording 40 billion in the year 2000 alone. But as debit and credit cards gained in popularity, reliance on checks have plummeted. Now, the emergence of mobile payments are looking to disrupt the transaction industry once more. At the forefront of these mobile payment solutions is Samsung Pay. In Tharawat Magazine‘s first Guide for the Modern Entrepreneur, we find out more about this revolutionary service.
What is Samsung Pay?
Introduced in 2015, Samsung Pay is a mobile payment service that replaces the need to swipe your credit card. To make a payment with Samsung Pay, the customer simply needs to open the app, hold it over the store’s magnetic card reader, and the transaction is complete.
How does Samsung Pay work?
In order for Samsung Pay to work, you will need the following:
- A compatible Samsung mobile device
- A card from a supported bank
- A Samsung account
- A verified fingerprint or Samsung PIN
Once you have downloaded and installed the app, you will need to sign in to your Samsung account or set one up if you do not have one. The first action will be to register your fingerprint if you have not already done so on your device. Alternately, you can assign a PIN if you would prefer not to use a fingerprint.
Now it is time to add payment methods. Simply select the option to add a card and then follow the instructions. There will be frame on the screen to detect your card information, but should that fail you can also input the information manually. Once you have followed instructions and verified your card you are ready to go out and use Samsung Pay. The service uses a MST (Magnetic Secure Transmission), which mimics a magnetic stripe allowing it to be used like an actual credit card.
What devices and banks are compatible with Samsung Pay?
There are five devices compatible with Samsung Pay: the Galaxy Note 5, Galaxy S6, Galaxy S6 active, Galaxy S6 edge, and Galaxy S6 edge+.
If you have one of the above devices, then you need to have a valid carrier. There are currently seven cellular carriers that are compatible with the app: AT&T, cricket, Sprint, T-Mobile, Verizon, U.S. Cellular, or MetroPCS.
Finally, the service is supported by major banks and credit unions such as: US Bank, Citi, Bank of America, Chase, Key Bank, and PNC, as well as most American Express cards. One nice perk of Samsung Pay is that you can link up to 10 different cards on the app.
How secure is it?
Samsung Pay has many methods to ensure the app is secure. The user must use a fingerprint, a PIN, or a backup password to even open the app. In the app itself, Samsung protects your payment card information by means of tokensation, meaning that your credit card number is never stored with the merchant or even in Samsung’s system, but only with the payment processor or bank.
If by chance you lose your phone or it is stolen, you can remotely lock and erase your payment cards. As soon as you lock it, all payments will be disabled and any transactions will be suspended. Once you find your device, simply re-authenticate your fingerprint or enter your PIN and all your cards will once again be unlocked.
How does it stack up against its competitors?
Currently, Samsung Pay has two main competitors, Apple Pay and Android Pay.
Apple Pay: Only compatible with iOS devices such as the iPhone 6 and iPad Air 2. Currently available in USA and UK with additional rollouts planned. Only uses fingerprint authentication for payments.
Android Pay: Works with any Android phone that supports KitKat (4.4) and higher. Currently available only in the USA.
By and large, the differences between the three players boil down to their availability on certain devices and operating systems, as well as the number of banks that support their service.
However, Samsung Pay has one major advantage over the other two services in its MST, meaning that a person can use the app anywhere credit and debit cards are accepted. This gives it a major head start over Apple and Android Pay, since more stores have magnetic strip card readers over NFC readers.
With the world moving ever closer to what has been described as a cashless society, mobile e-payments will be at the forefront of innovation and growth that the modern entrepreneur cannot do without.