India Launches AI Chatbot-Led E-Commerce Pilot
India has initiated a pilot program allowing consumers to shop and pay directly through AI chatbots, with OpenAI's ChatGPT at the forefront and integrations with Google's Gemini and Anthropic's Claude underway. This move marks India's emergence as a significant market for global AI companies.
On Thursday, the National Payments Corporation of India (NPCI) partnered with OpenAI and fintech firm Razorpay to enable shopping and payments directly via ChatGPT. Razorpay confirmed that the pilot is being rolled out nationwide and will be widely available in the coming months.
The initiative is built on UPI Reserve Pay, a new NPCI protocol allowing users to block funds for future debits to designated merchants, and UPI Circle, which delegates UPI authentication, enabling payments within ChatGPT without external apps. Razorpay has developed the merchant integration layer for AI chatbot transactions.
Tata Group's online grocer BigBasket and telecom operator Vi are initial merchant partners, allowing customers to shop for groceries or purchase mobile recharge plans through ChatGPT. Axis Bank and Airtel Payments Bank support the banking layer.
India, the world's most populous nation with over a billion internet subscribers, is already a top market for ChatGPT. OpenAI aims to expand its presence, launching a sub-$5 ChatGPT Go plan in August. The commerce pilot is part of its strategy to engage with India's growing digital economy.
UPI is a major success in India, processing over 20 billion transactions monthly. The new AI-led experience could further integrate UPI into daily commerce if consumers adopt chatbots for shopping.
Razorpay is in talks with other merchants and expects a broader rollout soon. Like OpenAI, Google and Anthropic are seeing increased users in India. Google has a strong local presence with products like Android and YouTube, while OpenAI and Anthropic work to localize AI offerings.
India's agentic payments plan does not include a revenue-sharing model for partners, but it could help AI companies like OpenAI achieve greater user retention. Mathur confirmed that AI companies will not access payment data, and users will pre-authorize transactions through two-factor authentication.
Last month, OpenAI introduced an 'Instant Checkout' experience and Agentic Commerce Protocol with Stripe, allowing businesses to connect with consumers using AI agents. Similarly, Google launched its Agent Payments Protocol for AI agent transactions.
In addition to Razorpay, Cashfree Payments has launched its Agentic Payments MCP, enabling merchant payments through shopping agents. Cashfree supports major payment methods, but merchants must develop their own shopping agents for integration.