India has launched a major pilot program enabling consumers to shop and pay directly through AI chatbots, positioning the nation as a key battleground for global AI companies. The initiative, led by OpenAI’s ChatGPT, is set to integrate with Google’s Gemini and Anthropic’s Claude soon, ushering in a new era of “agentic commerce.”
The UPI-Powered Integration
The pilot is a joint effort between the National Payments Corporation of India (NPCI)—the federal body governing the popular Unified Payments Interface (UPI)—OpenAI, and fintech firm Razorpay.
The experience relies on two new NPCI protocols:
- UPI Reserve Pay: Allows users to block a specific amount of funds for future, designated debits.
- UPI Circle: Delegates UPI authentication, enabling payments to be completed directly within the chatbot (like ChatGPT) without switching to external apps or websites.
Razorpay developed the merchant integration layer that facilitates these transactions. Initial merchant partners include Tata Group-owned grocer BigBasket and telecom operator Vi, allowing customers to buy groceries or recharge mobile plans instantly via the chatbot. Axis Bank and Airtel Payments Bank are providing the banking infrastructure.
A New Commerce Experience
The pilot is rolling out nationwide and is expected to become widely available in the coming months. Razorpay CEO Harshil Mathur noted that this is “not just a payment experience,” but a “whole new discovery and commerce experience.”
UPI is already the dominant digital payments channel in India, processing over 20 billion transactions monthly. By embedding UPI into this new, seamless shopping interface, NPCI aims to drive even greater adoption.
Razorpay has confirmed that the agentic payment experience has already completed a proof-of-concept for Google’s Gemini and Anthropic’s Claude, with consumer-facing integrations expected to go live in a few weeks. A broader rollout with more merchants is anticipated within the next couple of months.
Strategic Move for Global AI Giants
India, the world’s most populous nation, is already one of OpenAI’s top markets. This commerce pilot is part of a broader strategy by global tech firms to deepen engagement and tap into India’s booming digital economy.
- OpenAI recently launched a sub-$5 ChatGPT Go plan to attract more Indian subscribers.
- Both Google and Anthropic are seeing a surge of users in India and are actively working to localize their AI offerings.
While there is no specific revenue-sharing model planned, the move will significantly boost user retention for the AI companies. Importantly, Mathur confirmed that AI firms will not access payment data, as users will pre-authorize the amount through two-factor authentication.
This aligns with global trends: last month, OpenAI launched its “Instant Checkout” experience with Stripe, and Google rolled out its Agent Payments Protocol, both designed to enable AI agents to handle transactions on behalf of users. As Reeju Datta, co-founder of Cashfree Payments, noted, this is an “early, forward-looking concept” whose adoption will grow as “shopping agents take off.”
