Samsung Pay will stay 'commission-free' for card companies

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Samsung Pay will stay 'commission-free' for card companies

Published: 19 Jul. 2023, 15:14

Samsung Pay [SAMSUNG ELECTRONICS]

Samsung Pay will not charge local credit card companies any commission, bucking speculation it would follow Apple Pay's footsteps.

The move comes two months after Samsung Pay sent notices to the companies about not renewing the current contract at the time.

“Samsung Electronics decided on a commission-free Samsung Pay and [now] plans to renew the contracts with local card companies,” the company said in a release Tuesday.

“Samsung Electronics will co-exist with local card companies for the growth of Korea’s 'pay' ecosystem and provide customers with the best Samsung Pay service.”

Samsung Pay, Korea’s biggest offline mobile payment service with 20 million users, has not charged local credit card companies commission since it launched the service in 2015. These conditions have been automatically renewed each year.

This year, however, Samsung Pay sent notices to local credit card companies that the conditions would not be automatically renewed but subject to negotiations, raising speculation that Samsung Pay will start receiving fees just like Apple Pay.

Apple Pay, which started service in Korea in March, is currently available exclusively with Hyundai Card and is charging an estimated 0.15 percent commission per transaction. This commission had prevented credit card companies from immediately jumping onto the Apple Pay bandwagon, as they were already experiencing declining sales amid a slow economy.

BY JIN EUN-SOO [jin.eunsoo@joongang.co.kr]