Samsung is buying mobile-payment startup LoopPay as the Korean phone maker steps up its rivalry with Apple and its payment system on iPhones. LoopPay's technology has the potential to work in approximately 90% of existing point-of-sale (POS) terminals, according to internal research, with no investment in new infrastructure required by merchants. LoopPay will join Samsung to strengthen the company's overall efforts to provide users with mobile wallet solutions.

LoopPay has built a widely accepted contactless payment solution using its patented Magnetic Secure Transmission (MST) technology. It works by reproducing the signals from a credit card's magnetic swipe as users tap a LoopPay device next to a retailer's card reader. Most other mobile-payment systems, including Apple Pay, require newer terminals with wireless chips called near-field communication (NFC).

As part of the acquisition, LoopPay founders Will Graylin and George Wallner will work closely with Samsung's Mobile Division.

Samsung 's agreement to buy LoopPay strengthens speculation that Samsung plans to include mobile-payment technology in its next major phone, which is expected to be announced March 1 at the Mobile World Congress in Barcelona.

Samsung had an existing relationship with LoopPay as it was a strategic investor along with Visa and Synchrony Financial.