Samsung is expanding its partnership with MasterCard to bring Samsung Pay to Europe and offer a smartphone-based contactless payment alternative to Apple Pay, which recently launched in the UK.
MasterCard will provide Samsung Pay with the MasterCard Digital Enablement Service (MDES), which protects bank card details through the use of tokens.
The process replaces the details of a bank card with a device-specific token and a single-use dynamic code which is decrypted only when it reaches the customer’s bank during the payment authorisation process.
This means that the retailer has no access to the card details during the processing of a contactless payment made with a mobile device.
Javier Perez, president of MasterCard Europe, explained that the partnership will expand the reach of Samsung Pay and MDES to cardholders in Europe.
“Europeans have been leading the way in the adoption of new ways to shop, buy and make a payment. Through our strong partnership with Samsung we look forward to continuing to drive innovation in mobile commerce by creating simple and secure digital payment experiences for consumers,” he said.
Injong Rhee, global head of Samsung Pay, echoed Perez’s statement and added: “Both organisations are committed to ground-breaking financial technology innovations that will deliver on the promise of a true mobile wallet.”
The partnership will mean that banks suppling MasterCard will be able to connect to the MDES platform and enable Samsung Pay to be used by its customers as soon as it launches.
Apple Pay may have stolen the lead on its Korean rival, but Samsung Pay works with magnetic secure transmission (MST), which enables contactless payments to be used with existing magnetic stripe card readers, whereas Apple’s alternative works only with near-field communication-enabled terminals.
Samsung Pay works with both systems, allowing it to be used in a wider range of retail outlets than Apple Pay.
But Samsung’s theoretical edge may be quickly eroded as NFC technology becomes more widely distributed.
Samsung Pay is yet to launch at all, while Apple Pay has been live in the US for several months and has had more time to establish itself in the payment market.