Samsung Pay Faces Loss Of $16.8 Million

Samsung Pay has faced a loss of almost $16.8 million; shockingly, the tech giant has not shown any concern.

Samsung Electronics stepped into the business of mobile payments not so long ago and has been making the service attractive each day by putting in new features and promotion deal for customers. However, a loss of almost $16.8 million has been reported from this department of the South Korean company’s business, which shockingly is not as concerning as it should have been for the organization.

Samsung made the mobile payments application accessible to customers who owned Galaxy S6 and S6 Edge, Note 5, and now, Galaxy S7 and S7 Edge. These smartphones are the high-end products of the organization so far. The app was not available for all smartphones.

Samsung had to stand head-to-head with its biggest rival in the market, Apple, which also has the same mobile payments application known as Apply Pay. Thus, the tech company came up with its own service of the same category, Samsung Pay. The difference between these two competitors was that Samsung’s service consisted of the magnetic strip technology, which made it compatible with older modes of payments and did not limit it to the latest NFC tech, which most of the other mobile payment systems are.

The Galaxy maker made the mobile payments application as good as it could be, but still lost $16.8 million last year. It might have caused some damage but not enough to let the company worry about it. This is mainly because the application was launched in September in very few markets and later led itself towards expansion starting this year. The tech business spent ample of time in gathering as many merchants as it could and even other financial institutions so that it grows to a massive scale in the future.

The organization is not concerned with the loss and considers it an investment of a kind for the future. It believes that this would raise the demand in the market for its high-end mobile phones. The report shows that the mobile payments service managed to generate profit of almost $4.12 million and a loss of $16.8 million making its net worth $23.6 million and $10.5 million. The application has 70 different banking companies backing it up, which 70% of the card companies in the United States.

Samsung Pay was recently launched in China and is already going strong there, it has further plans of launching in Brazil, Spain, Italy, Singapore, and Australia by the end of 2016. For now, it has 500 million customers in the US and South Korea, the company’s hometown.