Revolutionary Technology Enables Legacy POS for Mobile Payment

11/5/2013
Companies such as Google, Isis and Mastercard compete to establish an NFC-based mobile payments standard, as well as an ecosystem that supports it. A new company, Loop, is debuting a platform that will let customers use their phone to make payments on nearly 90% of all POS systems in the country, even if they don't have any contactless payment technology embedded inside.
 
Loop is built on a platform that enables consumers in the U.S. to securely load cards on their smartphones and use payment cards at many merchant locations. The payment solution also enables merchants to easily promote actionable deals and offers to customers' mobile devices, without heavy integration or cost.
 
The patent pending platform includes mobile peripherals, apps, and cloud-based services to facilitate truly innovative next generation commerce. Loop will be a mobile wallet solution that helps consumers get deals while providing merchants, acquirers and issuers the ability to reach their customers with offers and promotions. The key components of the loop suite include:
  • LoopWallet: a mobile wallet app for consumers to easily load all cards into a secure memory accessed via smartphones.
  • LoopPromote: a turnkey mobile marketing tool for merchants to build and deliver special offers to mobile users and easily interact with customers through their smartphone
The Loop fob is a device that plugs into an iPhone or Android handset through its headphone jack. The device is approximately the same size as a matchbook and features a mag-stripe reader similar to a Square device. This fob, encrypts and stores credit or gift card information, transmitting it to POS systems.
 
During setup, users will be prompted to download the LoopWallet to the phone, responsible for managing all credit and gift cards, loyalty and membership cards, and even an ID. Information in the app is protected by a four-digit PIN number.
 
So, how exactly does the Loop work? The Loop transmitter can manipulate the magnetic field enough to transmit the mag-stripe data from cards, causing the POS to think it just registered a normal card swipe. For security, the encrypted information is only transmitted during the few seconds it takes to make a transaction. No data is sensitive data is stored on Loop servers and all card information is protected  by the PIN. In order to use the device, customers must have a Loop account – if the device is stolen a username and password are required before purchases can be made.
 
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Mobile Payments: The Slow Road to Mass Adoption
PayPal Extends Mobile Offering with Inventory Management
 
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