Visa CEO Says AI Shopping Has Arrived but Agentic Payments Haven’t

Visa CEO Ryan McInerney recently discussed the impact of artificial intelligence on consumer shopping and payments at the Goldman Sachs Communacopia + Technology Conference. While consumers are already using AI for shopping purposes, such as comparing products and identifying items, the adoption of AI for autonomous payments remains limited.

McInerney highlighted a trust issue, stating that three-quarters of consumers surveyed do not trust agentic platforms to make payments autonomously with their financial information. However, among those who use large language models (LLMs) at least weekly, 61% expressed trust in Visa as an agent to handle payments. In terms of fraud prevention, McInerney emphasized that Visa is moving towards addressing identity risk before it results in fraudulent transactions.

The company is exploring solutions like BioCatch, an identity verification tool, to protect users' identities on mobile devices before any fraudulent activity occurs. Regarding Visa's internal use of AI, McInerney noted that the company's teams are producing 80% more code commits, resulting in an 80% reduction in time required to design and build products.

They are also developing features 65% faster. Additionally, Visa is leveraging tokens to expand its distribution platform for risk-and-identity solutions and transaction solutions. These tokens have captured only a small percentage of the addressable markets in issuer services, acceptance, risk, identity, and advisory. Visa's growth in global credential growth, which stands at 6% to 7% annually, is expected to fuel further growth in issuing revenue.

Processing is another area of expansion for Visa. The company acquired Pismo to address the need for a global, nimble, and cloud-native issuer processing technology, particularly for small and mid-sized banks and FinTechs seeking integrated credit and debit issuer processing services. While large banks have been slower to modernize their cores and move them to the cloud, Visa believes that cloud-based cores can increase agility and enable banks to deploy products more quickly.

The scope of issuer negotiations encompasses a wide range of products, including consumer payments, commercial payments, Visa Direct, value-added services, and processing. Processing represents another significant growth area for Visa. McInerney noted that two key factors drove Visa's acquisition of Pismo: many bank CEOs were considering moving their technology to the cloud, while FinTechs were struggling to find issuer-processing technology that could scale with their rapid expansion.

Visa sees a market opportunity among small and mid-sized banks and FinTechs in the U.S., anticipating that larger, more sophisticated issuers will continue to operate customized credit and debit stacks separately. Issuer negotiations are becoming more complex, as issuers are seeking integrated solutions beyond consumer payments, such as commercial payments, Visa Direct, value-added services, and processing, including issuer and core technology.

In terms of the remaining addressable market, McInerney estimated it to be around $2 trillion, with a significant portion still represented by cash and checks in various markets worldwide. Visa Direct already reaches 18 billion endpoints across accounts, cards, and wallets, supporting peer-to-peer, business-to-consumer, and consumer-to-business transactions.

Visa also sees potential in cross-border B2B payments, with stablecoins potentially serving as a solution for some cross-border use cases. Visa identifies two primary product-market fit areas: one being the approximately 50 countries where consumers, families, and businesses have faced barriers to holding U.S. dollars due to cost, availability, or other factors.

The second area is cross-border money movement, including remittances and B2B payments. The company believes that product-market fit is strongest in these areas, as consumer spending continues to show stability and strength. While competition in the payment networks space remains intense, Visa acknowledges that payment sovereignty is gaining prominence in Europe, where domestic card networks and digital wallets are already competing with international networks. Visa expects the payment landscape to become even more competitive in the future.