Samsung’s mobile payment service, with the primary function of maintaining customer loyalty to its smartphones, made a net loss of $16.8 million last year, said ETNews.
Samsung Pay was previously US firm LoopPay until its acquisition by the South Korean vendor in early 2015 and made the loss in its first full year as part of the larger group.
According to Samsung Electronics’ 2015 audited report, the payment service recorded $4.12 million in sales. Its debt and net worth were $23.6 million and $10.5 million, respectively.
Samsung recently said it had attracted five million registered users and processed $500 million in payments since the launch of the service in South Korea and the US last year. The size of payments processed is a significantly higher figure than the revenue accrued as a result.
Viewed solely on its business performance, Samsung Pay is close to “failing grade”, said the report, but there is a wider picture: the service helps differentiate Galaxy smartphones from rivals.
In terms of how Samsung Pay could generate more revenue, the vendor made clear it will not charge a commission for transactions to end users. However, the data generated by customer spending habits has value not just for Samsung but, potentially, companies in other sectors, such as retail or transport.