AI-Powered Shopping: A New Reality for Visa, Mastercard Users
In the coming months, major payment giants Visa and Mastercard are set to revolutionise the way we shop online, as they introduce AI-driven shopping agents. This shift towards autonomous shopping agents is set to transform the payments and commerce landscape, automating complex purchases, improving user experience, and opening new business opportunities.
The vision of these card networks centres around AI-driven "agentic commerce," where sophisticated AI agents shop and handle transactions on behalf of consumers. These agents are expected to act as intelligent shopping assistants, making proactive purchasing decisions and completing transactions without human intervention.
Key elements of this vision include agentic commerce, enhanced consumer experience, benefits to companies, expanded payment ecosystem value, security and trust, and ecosystem players. Agentic commerce is enabled by secure tokenization protocols that protect payment credentials, allowing consumers to gain unparalleled convenience through automation of tedious tasks and personalised recommendations. The AI agents optimise shopping by finding the best prices and managing spending limits, reducing friction and cart abandonment.
For businesses, this new shopping method could potentially reach new customer segments and transact in ways previously difficult, potentially increasing conversion rates. Operations like procurement and expense management become radically more efficient, lowering costs and freeing employees for strategic tasks. For the card networks themselves, AI-driven commerce is forecast to cause a significant surge in transaction volumes across consumer, B2B, and machine-to-machine payments, boosting revenues and solidifying their roles as the secure core of this new economy.
Advanced fraud detection and secure API designs are critical to managing AI-driven, complex transaction flows, ensuring safety and consumer trust—a major factor shaping the adoption and regulatory frameworks of agentic commerce. Visa and Mastercard are collaborating with major tech companies like Microsoft, OpenAI, and others to embed AI-driven payment and commerce capabilities.
The total addressable market for agentic commerce is estimated at around $136 billion by 2025, with potential growth reaching $1.7 trillion by 2030. This new shopping method could potentially reduce drop-offs in the customer journey and revolutionise consumer shopping behaviour in the coming years.
An example given by Visa shows a person typing "Buy me the best" and an AI completing the sentence with specific items like a coffee maker or a birthday gift, and then making the purchase with a few clicks. Visa's feature, and a similar one from Mastercard, could make online shopping more comfortable for customers by reducing the overwhelming wave of information.
However, it is unclear at this time what specific benefits the payment companies hope to gain from this new shopping method or who would be liable if the AI makes mistakes during shopping. The business of major payment companies, including Visa and Mastercard, may be affected by this shift towards AI-powered shopping.
Nils Heck, the founder of the journalism bureau dreimaldrei, author, and the editorial director at Payment and Banking since March 2024, has been closely following this development. He is also the author of the monthly column "Nils nörgelt," where he critically examines current trends in the payment and banking industry.
This development marks a first sign of how consumer shopping behaviour will change in the coming years, with Visa's new feature aiming to bypass websites and payment portals, potentially leading to more frequent purchases. Recently, ChatGPT introduced its first shopping feature, which is remarkably similar to Google Shopping in a chatbot-optimized form. The new feature by Visa could potentially lead to a fewer brands becoming stronger due to personalised AI recommendations.
As we move towards an era of AI-driven shopping agents, it is essential to ensure that these developments prioritise security, trust, and consumer protection while providing unparalleled convenience and efficiency.
The new shopping method spearheaded by Visa, aimed at automating complex purchases, is expected to expand into areas of business, finance, and lifestyle, as AI agents handle transactions on behalf of consumers. This shift towards AI-driven commerce could potentially increase conversion rates for businesses and streamline procurement and expense management, hence benefiting companies.
The development of AI-driven shopping agents, with their secure tokenization protocols, could revolutionise the way technology companies, including Visa and Mastercard, operate in the commerce landscape, causing a significant surge in transaction volumes and boosting revenues.
