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Sarah Tew/CNET
BARCELONA — Not even a year after the launch of Apple Pay, Samsung revealed its own mobile payment solution, launching Samsung Pay at Mobile World Congress in Barcelona. The announcement wasn’t a surprise — clues hinting at a payments play surfaced when the company announced its acquisition of LoopPay in February.
Though it sounds and acts a lot like Apple Pay, the two services aren’t the same. Here’s what we know.
Compatibility
Unlike Android Pay or Visa Checkout, which allow any smartphone OEM or app developer to white label a mobile payment solution, Apple Pay and Samsung Pay are proprietary in that they are only compatible with the devices Apple and Samsung green-light, respectively.
Samsung Pay: When it launches in the summer, Samsung Pay will be compatible with the Samsung Galaxy S6. Even though other phones in its lineup include NFC (which, with the right combination of other hardware, could enable secure mobile payments), Samsung did not mention backward compatibility. This includes Gear smart watches, which will not be compatible at launch.
Apple Pay: Apple Pay is compatible with the iPhone 6 and iPhone 6 Plus, as these are the first two phones in Apple’s lineup to include NFC as well as a Secure Element chip (more on that later). While we know the Apple Watch will work with Apple Pay, details about using it to enable Apple Pay on NFC-free devices have yet to emerge, but we do know the watch will include NFC.
Security
In a landscape where many consumers are reluctant to replace their wallets with a not-always-reliable device, security is an important factor in the adoption rate of mobile payments.
In addition to tokenization, hardware plays an important role in securing your bank accounts. Two of the more important ones are: the Secure Element and device access. (Read more about the Secure Element here.)
Samsung Pay: Right now, we don’t know much about the Galaxy S6’s Secure Element beyond the fact that it’s supplied by Infineon, a German manufacturer. Based on previous reports, we know that Infineon’s chips are built with hardware-based security mechanisms, though the details of how those mechanisms play out have been unclear.
Device access is equally important, so Samsung Pay safeguards access to your mobile wallet by requiring a fingerprint for each transaction. So far, fingerprint scanning is the most secure way to prevent unwanted device access without the use of a complex password.
Apple Pay: We know even less about Apple’s Secure Element, though the company has hinted at hardware-based security mechanisms that would safeguard against any tampering. And just like Samsung Pay, Apple Pay requires a fingerprint at the time of each transaction.
Transaction data
Transaction data — especially data that can be tied to other information like location and phone usage habits — is of great value. With mobile payments being so young, it’s important that providers like Apple and Samsung tread carefully with the tracking and usage of this data.
Samsung Pay: While we know that you’ll be able to access your own transaction history on your device, Samsung’s tracking and storing of data is still unclear. When asked, Samsung did not comment. Most likely, the company will share more around the launch of the service this summer.
Apple Pay: Apple was very direct during its launch — the company does not track or store your purchase data, nor does it supply retailers with that data.
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Ease of use
Paying with a smartphone shouldn’t take longer than paying with a credit card. For that reason, it’s important that Samsung and Apple’s solutions are fast and easy to use.
Though we haven’t tested Samsung Pay in the real world yet, it’s already clear it requires a couple steps more than Apple Pay. With Apple Pay, you tap your phone to the payment terminal and scan your finger — even if the phone is locked. This is a huge win for Apple Pay, as there is very little friction during a mobile payment transaction.
With Samsung Pay, you first have to choose your credit card, scan your fingerprint and then tap the phone to the terminal. And unlike Apple Pay, we don’t yet know if you’ll have to unlock your device before completing these steps.
Where Samsung Pay wins
Mobile payments are great — as long as you can use them. In the US, it’s estimated that less than 300,000 merchants are equipped to accept NFC-based mobile payments, which is just a small fraction of the millions of retailers nationwide.
That’s not an issue in Europe, where chip-and-PIN terminals are ubiquitous.
By 2016, the US could be on the same track. Card issuers like Visa will be required to use the more secure chip-and-PIN cards, forcing retailers to adopt more modern credit card terminals. When that happens, it’s likely that most of those terminals will also be NFC-ready.
Until then, Samsung Pay will work in a lot more places. With the acquisition of LoopPay, the company integrated a technology that allows the phone to work with NFC-free magnetic stripe card readers. Meaning, you can use a Galaxy S6 with almost any old terminal.
