The mobile wallet sector is still very new in a lot of ways, but one company—Boston's own Loop—is out to make a mark in a big way in this new technology, and as such, looks to offer up a mobile wallet technology that's both versatile and secure. A recently concluded round of funding that netted the company $10 million proved plenty believe in Loop's capability to fundamentally alter the world of mobile wallets, and given that the funding round was actually oversubscribed, it shows how far that vein of belief runs.
Those who got in at the Kickstarter and pre-order levels are set to receive Loop Fob units by the end of this month, which coincides with the release of both the mobile app and the Loop Fob itself, dubbed an “AppCessory.” The combination of the two is said to lead to the solving of perhaps one of the biggest problems involved in getting mobile wallet services out into the field: compatibility. While some have addressed the mobile wallet issue by developing specific hardware, Loop takes advantage of what's already in place. It works with current mag stripe readers located at most point of sale terminals, turning these into contactless payment receiver systems.
What's more, Loop can take Payment Card Industry (PCI (News - Alert)) standards to the utmost, offering top-notch security for the cards contained in the Loop Fob, while also stepping things up to allow for not just payment cards, but also gift cards, loyalty program cards, and so on, literally clearing a wallet from most every kind of card, with the possible exception of a driver's license.
LoopPay—the company behind Loop—CEO Will Graylin offered up some elaboration on what makes Loop special with a set of remarks: “Loop has created an almost magical experience, allowing consumers to use their phone as their wallet at nearly every place they shop today. It’s really cool to see the reactions of merchants and consumers when they see Loop in action. For merchants and card issuers, Loop is another channel to interact with their customers, in an app that consumers rely on every day to pay for things.”
While Loop offers a very interesting prospect in terms of mobile payment systems, what's particularly noteworthy here is the oversubscription of its “angel” funding round. It's said to be one of the largest angel funding rounds seen recently, and further sets LoopPay up for its Series B round, giving it a good chance at growth capital, particularly through the early part of 2014. Naturally, it's going to need that kind of help in the short term; it's got to get the word out and educate the populace as to how it works and why merchants can take Loop right now. But with $10 million on hand going in, and likely more to come, having the necessary cash on hand to run a worthwhile marketing effort is both possible and likely.
There's quite a bit of “if” in Loop's foreseeable future. If it can get the word out properly, if it works as well and as universally as early reports suggest, if it can fend off the competition in the mobile wallet market, if it can gain sufficient traction among retailers and users...if all of these things come to pass, then Loop has a very big potential future ahead of it, and may well be the weapon of choice for a great many shoppers out there. Only time, however, will tell if the execution lives up to the possibility.
Edited by Ryan Sartor
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