Visa, Mastercard, PayPal Fuel Agentic AI Commerce Boom

Three of the world’s largest payment companies, Visa, Mastercard and PayPal, are racing into the next frontier in digital commerce: agentic AI.

This week, all three announced they were deploying agentic commerce, a fast-emerging trend in which AI agents not only assist consumers with shopping but also complete transactions on their behalf.

“These technologies have the potential to radically transform commerce, to radically transform how we all shop, how we all buy, and how commerce works at its most fundamental layers,” said Visa CEO Ryan McInerney at a livestreamed company product unveiling.

Agentic commerce will be rolling out in the next few quarters, McInerney said in a separate interview with Bloomberg TV.

Visa is working with Anthropic, Microsoft, Mistral, OpenAI, Perplexity and others to integrate payment capabilities into AI chatbots. When people use AI chatbots to shop, they will also be able to use AI agents to pay for purchases — something not possible yet.

Absent were eCommerce giant Amazon and Google, whose core search business risks eroding from AI chatbots’ popularity.

The three companies’ agentic commerce initiatives are:

• Visa Intelligent Commerce is a platform built to support AI agents in executing trusted, tokenized transactions globally.
• Mastercard’s Agent Pay replaces payment information with digital tokens for security. Consumers can set parameters under which the AI agent is allowed to make purchases.
• PayPal Agent Toolkit enables developers to integrate its payment processes into the agentic AI workflow.

At the heart of Visa and Mastercard’s agentic commerce capabilities is the idea of tokenization, creating a new 16-digit series of numbers — or a cryptographically protected token — linked to the consumer’s original card and giving it to the AI agent to use.

It’s like giving the AI agent its own credit card but with strict, parental-style controls. Consumers decide when to activate it, what the agent can buy and how much it can spend. It only works for that AI agent.

According to the PYMNTS Intelligence report “Why Network Tokenization is eCommerce’s Newest Essential,” network tokens, provisioned by the major payment card networks in partnership with issuing banks, enable merchants to protect sensitive card payment information while reducing costs and boosting sales.

PayPal’s approach is different. It offers a developer toolkit and access tokens that let AI agents interact directly with PayPal’s platform through APIs. APIs are pieces of code that let software programs quickly integrate a capability, like plug and play.

“The rise of agentic commerce represents a seismic shift in digital retail, following the waves of eCommerce and mobile, with profound implications for consumers, retailers and financial institutions,” Jerry Sheldon, an analyst at IHL, told PYMNTS.

Martin Balaam, CEO of Pimberly, which curates product data for retailers, manufacturers and distributors, said agentic commerce is revolutionary.

“It’s a chance to meet customers right at the moment of intent — no more hoping they click through a catalog or keyword ad,” Balaam told PYMNTS. “AI can surface exactly the right SKU based on a nuanced request,” such as, “Show me eco-friendly running shoes under $100.”

“Search as we know it will inevitably give way to intent understanding,” Balaam said. “Instead of 10 blue links, shoppers will get a curated set of product suggestions, comparisons and even proactive deals based on their profile and behavior.”

That also means retailers must optimize for this new landscape to ensure that consumers are directed to their products, Neil Saunders, managing director and retail analyst at GlobalData, told PYMNTS.

Winners will be those retailers that feed the AI agent the right data, such as “real-time inventory, pricing, product and purchasing” information so they show up in the AI agent’s recommendations,” Sheldon said. Those who don’t risk losing out.

AI agents can better match consumers to what they want, so this could “significantly” reduce returns, he said.

For consumers, an AI agent acts as a concierge that can plan, shop and pay for them, saving them time and effort. But to get them to engage in the technology, gaining their trust is paramount.

“Agentic commerce is poised to redefine convenience and efficiency in retail, but its success will depend on building trust, ensuring transparency, and working hand-in-hand with regulators to protect consumers,” Sheldon said.

According to Saunders, “People will be very comfortable with allowing agents to do things like searching for the best options, finding the best prices, and even arranging delivery and so forth.

When comes to payment, he said, “consumers like to remain in control, and payment companies need to ensure that this is put in place along with safeguards.”

Sheldon said the following features are needed to scale agentic commerce.

• Reliable trust layer: Payment networks building the trust infrastructure for agentic commerce must include robust agent verification, real-time behavioral monitoring, and clear audit trails to ensure accountability and prevent unauthorized activity.
• Transparent boundaries: Consumers need clear visibility into what’s automated versus what requires human approval.
• Explainable decisions: When an AI chooses brand X over brand Y, consumers will want to understand the decision factors — price, quality, brand reputation, sustainability, delivery speed and the like. Payment providers must work with retailers to standardize this data disclosure.
• Failsafe recourse: Real-time cancellation protocols and robust dispute resolution will be essential for consumer confidence.

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