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LoopPay starts selling a programmable credit card sleeve for the iPhone 6 and 6 Plus

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Contactless payments startup LoopPay is taking advantage of the excitement surrounding Apple Pay to introduce its new line of programmable credit card gadgets, including a new sleeve for the iPhone 6 and iPhone 6 Plus that can be used in much the same way as Apple’s new mobile wallet.

So why is LoopPay recreating a payments capability that already exists in newest smartphones in the iPhone line? Well, unlike [company]Apple[/company] Pay or any of the other near-field communications (NFC)-based smartphone payment systems, LoopPay can theoretically work with any current U.S. credit card and at the vast majority of businesses that accept payment in the form of plastic.

As I’ve detailed before, LoopPay isn’t using NFC, Bluetooth, QR codes or any other new contactless technology debuting in new cash registers and point-of-sale (POS) terminals. Instead, it’s tapping into the same old mag stripe readers available in nearly every terminal today by generating a magnetic field that emulates the card swipe.

LoopPay generates an electromagnetic field that emulates the card swipe at standard point-of-sale terminals. Photo: LoopPay
LoopPay generates an electromagnetic field that emulates the card swipe at standard point-of-sale terminals. Photo: LoopPay

LoopPay’s system does have drawbacks. It doesn’t have any of the new security features of other new NFC and QR-code-based payments apps or emerging chip-and-PIN transaction systems (it’s basically as insecure as the mag stripe credit card is today). Also, LoopPay’s technology won’t communicate with about 10 percent of the POS terminals in the market today. But covering 90 percent of retail stores is still far better than what its competitors can accomplish. According to LoopPay, its wallet is accepted at 10 million U.S. retail locations, while [company]Apple[/company] Pay, [company]Google[/company] Wallet and Softcard are accepted at a few hundred thousand locations with new NFC terminals.

There are some new elements to LoopPay’s design. Instead of keeping the payment element trapped inside the iPhone sleeve, LoopPay is making it removable. That way, consumers can hand a fob over to a waiter or sales clerk instead of parting with their phones. The case also has a hidden compartment for a driver’s license and backup credit card in case a consumer is required to show ID or happens to be at a place that won’t support LoopPay’s technology.

The cases for the iPhone 6 and 5/5s cost $49.95 each on the company’s website. LoopPay also offers a stand-alone fob for Android users that costs $39.95. The case for the iPhone 6 Plus is available for pre-order, but when it will actually ship seems to be up in the air. When asked, a spokeswoman for LoopPay’s PR firm first said that the iPhone 6 Plus case hasn’t yet been prototyped and there was no timeline for its availability, but in a follow-up conversation she said LoopPay expects to ship the larger sleeve by early next year.

Before you buy, though, keep in mind that this time next year the retail industry will begin moving to new chip-and-PIN payment systems, which will eventually make mag-stripe transactions obsolete. The mag-stripe reader won’t disappear overnight, though, as it will take years before retailers all have the necessary hardware in place.

This post was updated on Tuesday with information on the iPhone 6 Plus case’s availability.

8 Responses to “LoopPay starts selling a programmable credit card sleeve for the iPhone 6 and 6 Plus”

  1. futurepay

    LoopPay has essentially found a way to make every existing magnetic card reader a contactless terminal. That’s pretty amazing and solves the acceptance gap that every other mobile payment solution is struggling with. This new transmission method will enable them to also add extra security features, just like NFC and EMV, but to the good old mag-stripe. This was previously impossible simply due to the use of dumb, static cards not because of the payment infrastructure. So instead of sending the same static card track data via a card swipe, every LoopPay transaction could include a one-time use token to protect each transaction and make the card data useless without it.

  2. Wait just a minute, LoopPay is invested by Visa, and is working with the same financial institutions working with Apple Pay today to roll out tokenization in 2015 that transmits one-time-use card data via Magnetic Transmission, and it would work with all the EMV terminals and mag only terminals worldwide. With tokenization, this technology will deliver more security, sooner, because it is accepted just about everywhere. Whether it is magnetic transmission or radio transmission doesn’t really mater, its the payload that maters, and where its accepted that truly maters to consumers – if you want to change their habits from plastic and cash that is.

  3. Hi, just want to clear up any misconceptions. LoopPay is not a temporary or bridge solution. LoopPay is working with closely with card issuers and networks to bring the same level of security for mobile payments. LoopPay will provide tokenization for mobile transactions through the existing point of sale systems. This will provide secure tokenized transactions with the highest level of acceptance. I work for LoopPay (just to be transparent). Cheers..

  4. LoopPay Guy

    LoopPay encrypts all data on your phone to prevent access by others – your cardholder info is also authenticated to prevent others from loading your cards. The app is locked by PIN & password so it is safer than carrying a wallet full of plastic cards. Not only does LoopPay work with current mag stripe readers today, it also will be launching in 2015 tokenized card data that will work with EMV terminals, which is the most secure way to deliver payments via mobile technology. LoopPay therefore has the flexibility to be secure today, and in the future.

  5. whitehot

    Security against POS terminal hacking, etc. is the prime attribute of ApplePay, Google Wallet, etc. This silly “technology” of emulating a card swipe achieves none of that.
    Stunning that it even is presented as a solution to anything.