LG Pay to end services after six years as competition intensifies

LG Pay [Photo provided by LG Electronics]

LG Pay, an online payment service launched by LG Electronics Inc., is set to end services this year as it loses ground to competitors, such as Samsung Pay by Samsung Electronics Co., Naver Pay by Naver Financial Corp. and Apple Pay by Apple Inc.

According to industry sources on Monday, LG Electronics will stop LG Pay services on June 30. The application for payment services, however, will be in operation for a while.

LG Pay was first introduced in June 2017 on growing online payment markets in Korea. The service uses a magnetic secure transmission method, also used by Samsung Pay, but applied payment solutions from Dynamics Payments LLC that use different technologies from Samsung Pay. The services were expanded to global markets, starting with the U.S. market in 2019.

However, LG Pay has lost its growth momentum following LG Electronics’ decision to end its smartphone business in 2021.

Though the online payment service was shut down in the U.S. when it exited smartphone markets, LG has been exploring ways to continue its payment service, seeking a shift to a platform-based payment service like Naver Pay or Kakao Pay by Kakaopay Corp. To this end, it partnered with card companies and expanded its services to web-based payments, allowing LG Pay users to pay online without an LG smartphone.

The attempt, however, seems to have failed to lead to any growth in the LG Pay user base, as it did not have its own specific platform. LG Electronics said it would review whether or not to keep its payment services after July 2024 as it ended its mobile phone business. With the closure of its key payment service, however, LG Pay is likely to end its service in practice.