Samsung Pay won over old card machines by faking a magnetic strip

When Samsung Pay launched — Korea on 20 August 2015, the United States on 28 September 2015 — Apple Pay and Android Pay had defined mobile payments as an NFC problem: great technology, but every shop needed a new terminal. Samsung's answer came from a 2015 acquisition: LoopPay, whose Magnetic Secure Transmission (MST) made the phone emit a rapidly changing magnetic field that a card-swipe reader interprets as a real card swiping. The result, as Samsung put it, was a payment service that worked on virtually any terminal that could read a magnetic card — from day one.

The strategy bought the network effect instead of waiting for it: no merchant upgrade required, so usability was immediate; where NFC was supported the phone used NFC instead (fast, but optional); and the claim of 'most existing POS' coverage was the wedge Apple and Google lacked. In the first year Samsung Pay cleared nearly 100 million transactions across seven countries, with more than 2 trillion won of cumulative transactions in Korea and 4 million-plus registered cards.

The genius was also the sunset: as NFC terminals finally spread, Samsung discontinued MST support starting with the Galaxy S21 (2021). The technology that had won the early game by mimicking the old rails was retired precisely because the new rails had arrived — a deliberate, self-terminating strategy that captured the compatibility window and then moved with the infrastructure.