A man passes a Samsung store in Seoul, South Korea. File photo: Truth Leem

New York - 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 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. That means LoopPay should work with most retailers' existing payment terminals.

Most other mobile-payment systems, including Apple Pay, require newer terminals with wireless chips called near-field communication, or NFC.

Samsung Electronics Company’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.

The companies didn't disclose financial terms or say when the transaction will close.