How Are AI Agents Going to Pay?

Yesterday, something remarkable happened. Google launched its Universal Commerce Protocol at the National Retail Federation conference, with Walmart, Target, Shopify, Visa, Mastercard, PayPal, Stripe, and 20+ other companies already signed on as partners.

The message was clear: the era when humans browse, click, and checkout is ending. The era when AI agents shop on our behalf has begun.

But here's the question nobody's fully answered yet: How exactly will these AI agents pay for things?

That question represents one of the largest investment opportunities of the next decade. McKinsey projects agentic commerce could reach $3-5 trillion globally by 2030. The companies building the payment rails for this new world will capture an outsized share of that value.

What Is Agentic Commerce?

Agentic commerce is shopping powered by AI agents acting on your behalf. Instead of you browsing Amazon, comparing prices, and clicking "buy now," an AI agent does all of that autonomously.

Imagine telling your AI: "Find me noise-canceling headphones under $300 with the best reviews, and buy them when the price drops below $250."

The agent then monitors prices across dozens of retailers, compares reviews, negotiates with merchant AI systems, and executes the purchase—all without you lifting a finger.

This isn't science fiction. OpenAI's ChatGPT already offers "Instant Checkout" with Etsy and Shopify merchants. Google's AI Mode lets you research and buy products without leaving the conversation. Visa reports that nearly 47% of US shoppers now use AI tools for at least one shopping task.

Adobe's data shows AI-generated traffic to US retail sites increased 4,700% year-over-year by July 2025. This isn't a trend. It's a tidal wave.

The Payment Problem

Here's the challenge: How do you give an AI agent your credit card?

You can't just hand over your 16-digit card number. The security model collapses immediately. Fraud would skyrocket. Merchants couldn't tell legitimate AI agents from malicious bots.

This is why the major payment networks have been scrambling to build new infrastructure. They're creating "protocols"—standardized ways for AI agents to identify themselves, authenticate with merchants, and make secure payments on behalf of humans.

Think of it like this: When e-commerce emerged in the 1990s, we needed new standards for online payments. SSL encryption, payment gateways, and fraud detection systems had to be invented. The companies that built that infrastructure—Visa, Mastercard, PayPal—captured enormous value.

The same dynamic is playing out now with agentic commerce, but faster.

The Protocol Wars

Five major protocols are competing to become the standard for agentic payments:

Universal Commerce Protocol (UCP) – Google's open standard, launched January 2026. Partners include Shopify, Target, Walmart, Visa, Mastercard, Stripe, and PayPal. Covers the full commerce journey from discovery to post-purchase support.

Trusted Agent Protocol (TAP) – Visa's framework for merchants to distinguish legitimate AI agents from bots. Integrates with Cloudflare, Akamai, and Microsoft. Live since October 2025.

Agent Pay Framework – Mastercard's system for registering and verifying AI agents before they can make payments. Partnership with Fiserv makes it one of the first processor-integrated solutions.

Agentic Commerce Protocol (ACP) – OpenAI's standard, co-developed with Stripe. Powers ChatGPT's Instant Checkout feature with Etsy and Shopify merchants.

Agent Payments Protocol (AP2) – Google's payment-specific protocol supporting credit/debit cards, stablecoins, and real-time bank transfers. Over 60 partners including Mastercard, PayPal, American Express, and Coinbase.

The good news? These protocols are designed to be interoperable. The companies that participate in multiple protocols—hedging their bets across the ecosystem—are best positioned regardless of which standards ultimately win.

The 5 Best Stocks for Agentic Payments

Here's my framework for picking winners: I want companies with high returns on invested capital (ROIC), because that indicates a durable competitive advantage. I want companies that can reinvest at attractive rates to compound over decades. And I want reasonable valuations that give a margin of safety.

1. Visa (V) — The Network King

Visa's network effects are nearly unassailable. They process transactions in 200+ countries, work with 100+ partners on agentic commerce, and have already completed hundreds of real-world AI agent transactions. Their Trusted Agent Protocol is the most mature verification system in the market.

ROIC above 35%. P/E around 34x (near historical average). Revenue growing 10-12% annually. Strong buyback program returning $18+ billion to shareholders annually.

Visa doesn't need agentic commerce to thrive—they're already a compounding machine. But they're perfectly positioned to capture an outsized share of the $3-5 trillion opportunity.

5-Year Upside: 40-60%

2. Mastercard (MA) — The Open Protocol Champion

Mastercard has taken the most aggressive "open protocols" approach. Their Agent Pay Framework, partnership with Fiserv, and collaboration with Google on UCP positions them as the infrastructure backbone for whoever wins the platform wars.

ROIC above 60%—one of the highest among large-caps. P/E around 35x. Revenue growing 12-15%. Operating margin of 58.8% in Q3 2025.

Mastercard's bet on interoperability mirrors their historical success with cross-border payments. They're not trying to own the customer—they're trying to be the rails everyone uses.

5-Year Upside: 50-70%

3. Alphabet/Google (GOOGL) — The Discovery Surface Owner

Google owns the protocol (UCP), the AI discovery surface (Search + Gemini), and the payment method (Google Pay). When an AI agent shops for you, there's a high probability it starts on a Google surface and uses Google's protocols.

ROIC around 20%. P/E of 32x. Revenue growing 12-15%. $54 billion net cash position.

The risk: If agentic commerce cannibalizes traditional search advertising, Google faces a tricky transition. But if UCP becomes the dominant standard, Google becomes the toll collector for a $3-5 trillion market.

5-Year Upside: 60-100%

4. Adyen (ADYEY) — The Enterprise Infrastructure Play

Adyen has built the most modern payment infrastructure in the industry—cloud-native, unified commerce across online and in-store, processing $1.5 trillion annually. They're a UCP endorsed partner and increasingly the go-to for enterprise merchants who need agentic-ready systems.

ROIC around 15% and rising. P/E of ~45x (premium valuation). Revenue growing 20-23% annually. EBITDA margins above 50%.

When major retailers need to upgrade their payment systems for AI agents, Adyen is the default choice.

5-Year Upside: 50-80%

5. PayPal (PYPL) — The Contrarian Value Bet

PayPal is the only company actively partnering with every major platform: Google (UCP), Microsoft (Copilot Checkout), and OpenAI (via Stripe integration). Their protocol-agnostic strategy is the ultimate hedge.

ROIC around 12%. P/E of just 12x—trading 72% below its 10-year historical average. PEG ratio of 0.88.

The risk: PayPal faces real competitive pressure and execution challenges. But at current valuations, multiple expansion alone could drive 50%+ returns if they execute even modestly well.

5-Year Upside: 50-80%

How I’d Think About Portfolio Allocation

Visa: 20% — Highest conviction, network moat + TAP leadership

Mastercard: 18% — Open protocol bet, superior ROIC

Alphabet: 15% — Platform ownership, higher risk/reward

Adyen: 12% — Enterprise infrastructure, premium quality

PayPal: 8% — Deep value, margin of safety

American Express: 7% — Premium segment exposure

Shopify: 5% — Speculative, agentic mostly priced in

Cash: 15% — Dry powder for volatility

Key Risks to Watch

Protocol Fragmentation: If UCP, ACP, TAP, and other standards fail to achieve true interoperability, adoption will be slower and the market more fragmented than projected.

Liability Frameworks: Who pays when an AI agent buys the wrong thing? This remains undefined. Stripe's recent terms update suggests merchants will bear the burden—many won't like that answer.

Consumer Adoption: Only 46% of shoppers fully trust AI recommendations according to IAB research. The "trust gap" could slow adoption significantly.

Regulatory Intervention: Antitrust concerns around Google's dominance of commerce discovery could reshape the competitive landscape.

Bottom Line

Agentic commerce isn't a question of "if"—it's a question of "when" and "how fast." The protocols are live. The partnerships are signed. Real transactions are happening today.

For long-term investors, the payment networks (Visa and Mastercard) offer the best risk-adjusted returns. They have wide moats, exceptional returns on capital, and they're building the infrastructure everyone else needs. They'll compound regardless of which AI platforms win.

Google offers higher upside but comes with platform risk. PayPal offers deep value with turnaround execution risk. Adyen offers quality at a premium price.

The next five years will determine which companies become the "Visa of agentic commerce." Position yourself now, while the market is still figuring out who the winners are. We are watching this space closely. You can access my full watchlist in real-time in our community.

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