With AI systems becoming increasingly agentic (i.e., capable of carrying out actions toward goals over extended periods of time, without humans being in the loop or pre-specifying their actions) and business-to-robot-to-consumer (B2R2C) commerce about to explode, it is a natural evolution for AIs to become economic actors in their own right and to exchange value in return for services. Bots paying other bots are a new frontier for the payments industry that needs new rails.
Your Bot Can Pay My Bot
As McKinsey say, chatbots are just the beginning of the evolution from the current knowledge-based, generative AI-based tools—such as chatbots that answer questions and generate content—to agents that use models to execute complex, multistep workflows across a digital world, “moving from talking to doing”. These software robots powered by agentic AIs — actually, for simplicity, let’s go back to calling them bots — will be just like human Internet users but much faster and much smarter.
(As I have often said, the big change in financial services will come when customers have AI, not when financial institutions have AI.)
There are startups already beginning to explore this new landscape. Nevermined (which raised $3m in its seed round) is building just such rails with the intention of becoming the “PayPay of AI Commerce”. Don Gossen, a co-founder of the company, told me that he believes that “AI agents will change commerce” and the fact is that I think he is right. We are seeing the birth of AI-driven economy that will be dominated by machine actors, with agents paying other agents directly for the services they require, and Nevermined sees an opportunity to provides the critical payment infrastructure needed to enable a new business paradigm.
It is not at all clear to me that banks, retailers, airlines and other have taken on board what this will mean for their medium-term strategies, and all of them will have to. Take the example of airlines, one familiar to most readers. Every time I try to use my frequent flier miles to go somewhere interesting, there are no seats available. In order to get seats that are actually useful, I have to log in every day to the airline site and look at flights months from now, with the family calendar open on one side and my work calendar open on the other side) and check half a dozen different routes. Frankly, I have better things to do. But my bot doesn’t, so the airlines are going to have to start thinking about how to market to the bots instead of customers.
If the idea of bots paying other bots in the consumer space may seem a little distant, take a look at the enterprise space and consider how a global manufacturing firm could transform its supply chain operations using the technology. Rather than simply linking inventory systems to procurement platforms, they could deploy orchestrated networks of intelligent agents that autonomously monitor stock levels, predict demand patterns and initiate orders without human intervention. This goes beyond simple automation to produce cognitive integration that can learn and adapt to changing business conditions. It is very small step to give those agents the ability to not only initiate orders but also to pay for them!
I can see how my bot can pay a British Airways bot using open banking and instant payments, but it is hard to see how my bot can pay your bot a quarter using Visa or how my bot can pay some Substacks while it assembles a morning newsletter for me. This is why the bot-to-bot space has been so energized by the rise of stablecoins, and why giving bots the ability to pay each other a Pound or a Euro or a Dollar instantly for next-to-nothing means a fundamental change.
Start-up Skyfire has created a payment network specifically for agents to make autonomous transactions. Their system assigns each AI agent a digital wallet with a unique identifier, where businesses can deposit a set amount of funds they want the agent to spend, so they don’t get unlimited access to a bank account. Skyfire also allows customers to set limits on how much an AI agent can spend in one transaction and over time. If an AI agent tries to overspend, it will ping a human to review it. Skyfire also offers a dashboard to view exactly how much, and where, their agent is spending.
Interestingly, when I asked Craig DeWitt of Skyfire how he planned to monetize a system of decentralized frictionless payments where the transactions margins will approximate to zero his answer was immediate. “Where we think we can make money is identity” he told me. This is crucial.
AI transactions are not only just about speed, reliability and efficiency. They are also about security: with the ability to integrate digital identity, agents ought to be much harder to fool than people are! The agents will ensure that all transactions comply with all the necessary security protocols while optimizing the process to save time and resources. A person might not be able to tell whether their counterparty is really a Norwegian lawyer with a Manchester City season ticket, but their bot will be able to request credentials, resolve certificates and force authentication of private key whenever necessary.
How Do I Know Your Bot?
A post-industrial revolution needs post-industrial money and I think this is where there might be opportunity for the incumbents as well as the fintechs. Banks might not be able to control the post-industrial rails or give me the post-industrial money to run on them, but they do know who I am and they do know who I pay and they do know how much my business owes them and so on. Jelena Hoffart, Director of Identity Value Chain Expansion at Mastercard, told me that she thinks it may turn out to be a pretty good business for the financial institutions to move beyond know-your-customer (KYC) to provide know-your-agent (KYA) identification and authorization services.
Far from being in the realm of science fiction, bots paying other bots will soon be part of the mainstream and this view, of a co-operative future where fintechs deliver these new rails while banks, instead of competing on the rails, focus on complementary services that enable them to monetize their regulatory responsibilities looks like a win-win.
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