Mastercard: Merchants Want AI Shoppers Without Losing the Customer

Mastercard executives revealed that merchants desire artificial intelligence shoppers, but they are cautious about losing the customer experience. The adoption of agentic commerce, which involves AI making purchase decisions for consumers, is reaching a critical juncture. Gaurang Shah, Mastercard's executive vice president of Global Acceptance and Merchant Solutions, observed that consumers are increasingly experimenting with AI agents due to their easy accessibility.

However, currently, consumers tend to stop at AI-generated recommendations rather than fully trusting the AI to complete purchases.

Shah explained that the next stage of agentic payments must encompass more than just transaction processing; it must also provide assurance and protection for consumers. While consumers generally expect safeguards in case of issues, merchants often view responsibility differently in such scenarios, believing that the liability should rest with the agent broker.

The challenge for merchants lies in establishing a "trust equation" between consumers allowing agents to transact and merchants agreeing to accept those transactions. Merchants need to ascertain the legitimacy of the agent, consumer authorization, the agent's permissions, and potential parameter adherence. The shift to agentic commerce may lead to a migration of the customer journey away from merchant-owned channels even before the merchant formally participates in the process.

Shah compared this transition to the early days of search engines, marketplaces, mobile apps, and eCommerce. Merchants learned to adapt to each new distribution layer. However, autonomous agents pose a more significant intermediary role, as they can potentially determine which merchant wins the transaction. Despite this, Shah emphasized that merchants still wish to maintain their direct customer relationships and unique selling points beyond mere price competitiveness.

The PYMNTS CEO, Karen Webster, highlighted that merchants want to offer both channels—merchant-owned properties and third-party AI platforms—while ensuring parity between the two. She stressed the importance of being where consumers are, as optimizing for price alone could be detrimental to brands. Agentic commerce introduces a battle over what AI recommendations should prioritize, moving beyond price to consider brand equity, service quality, authenticity, loyalty benefits, return experience, and consumer preferences.