Samsung’s new phones, featuring the ingeniously named Samsung Pay, can make payments at magnetic swipe credit card terminals, eliminating the need for newer NFC-enabled terminals to allow mobile payments. If the technology works and is as secure as reported, then it sounds like an interesting technology to increase mobile payment adoption during the transition to the newer payment terminals. Here’s a bit about how it works from The Verge:
To fix the problem of ensuring that more stores will take mobile payments, Samsung turned to a clever piece of technology that lets you pay at most any terminal where you can swipe a credit card. The trick comes thanks to a tiny coil that shoots out the same magnetic code that those readers normally get from your credit card. It’s called “Magnetic Secure Transmission,” or MST; it’s built into the Galaxy S6, S6 Edge, S6 Edge+, and Note 5. As with other mobile wallets, Samsung Pay can also let you pay with NFC and it will store loyalty cards and gift cards.
MST features tokenization, which is the real the game changer technology for secure mobile payments. I still prefer the security and simplicity of TouchID for mobile payments, though.