Mastercard’s AI commerce rollout pending regulatory approval

Mastercard demonstrated India’s first AI-driven agentic commerce transaction in a controlled sandbox, using real payments but with simulated merchant environments, according to company officials.

The demonstration involved live transactions on actual systems and cards, but merchants were connected through sandbox setups, as no Indian platform is fully integrated into an AI-agent ecosystem yet.

Mastercard’s India and South Asia president Gautam Aggarwal said a commercial rollout depends on regulatory clarity, which is expected in the coming months.

He explained that if regulators treat agent-led payments as extensions of existing technologies like tokenization or passkeys, the process could be quick; otherwise, it may take longer.

Aggarwal noted that the technology works across payment methods such as cards and UPI, aiming to automate the entire commerce process.

🔗 Source: The Economic Times

🧠 Food for thought

Implications, context, and why it matters.

Mastercard is joining an active race

Visa is already rolling out its “Visa Intelligent Commerce” platform across Asia Pacific, with pilots planned for early 2026 1.
Indian fintech giant Razorpay has announced a private beta of “Agentic Payments” on ChatGPT, built with NPCI (the government-backed operator of India’s retail payments network) and OpenAI’s ChatGPT 2.
The beta uses NPCI tools like UPI Circle and UPI Reserve Pay so users can pre-authorize a trusted AI agent within user-defined spending limits. This cuts repeated checks like entering a UPI PIN or a one-time password (OTP) for every transaction 2.
Visa and Mastercard are also lining up partners like Microsoft, OpenAI, and IBM to support secure, personalised payments for agentic commerce, according to MediaNama 3.

The fight centers on who sets rules for AI commerce

Agentic payments expose a regulatory gap in India since the Digital Personal Data Protection Act (DPDPA) and the draft DPDP Rules, 2025 do not explain delegated consent or AI-agent-controlled, token-based transactions 3.
With limited government direction, platforms and payment networks are shaping how these systems run. Visa is pushing its Trusted Agent Protocol so merchants can recognise and verify trusted AI agents, while MediaNama says the Reserve Bank of India (RBI), the Ministry of Electronics and Information Technology (MeitY), and NPCI have not issued clear guidance on AI-agent payments 1 3.
Razorpay calls India the fastest-growing user base for ChatGPT, while the Unified Payments Interface (UPI) processed over 14 billion transactions in May 2024 2 4.
AI agents could handle routine purchases or bill payments before legal safeguards are in place, which can leave users unsure about liability or disputes after a costly error even when existing payment rails include security safeguards 3.