Artificial intelligence (AI) is already changing retail and payments, but not necessarily where businesses expect it to. While AI-powered shopping agents are beginning to reshape the customer journey, machine learning has been helping payment providers detect fraud for decades.
Wayne Steppe, enterprise architect at Ecentric Payment Systems, explores how AI is reshaping the future of shopping. (Image supplied)
For retailers and payment businesses, the bigger challenge is understanding where AI adds value, where it introduces new risks and how it will change the way consumers discover, buy and pay for products.
AI is like dynamite: a powerful tool that can dramatically increase productivity, but one that demands careful handling.
1. AI has been powering payments for years
AI is not new to the payments industry. Machine learning and predictive analytics have been used for around two decades to monitor transaction patterns and identify potential fraud.
The core payment process is mature, well-defined and regulated. AI does not need to reinvent the card networks to make them work better.
Instead, it already helps banks assess the risk of individual transactions. With 3D Secure 2, for example, authentication can adapt to a customer's behaviour and transaction history. A familiar purchase may go through without additional checks, while an unusual transaction, such as one made from another country, may trigger verification.
These systems are not infallible. Legitimate payments can still be flagged as suspicious, which is why models need ongoing monitoring and refinement by human specialists.
2. Cybersecurity is becoming an AI arms race
The bigger security shift is happening around payments, rather than within the transaction process itself.
AI tools have made it easier to create convincing impersonations, deepfakes and other sophisticated attacks. Businesses must contend with a growing volume of threats, even when their existing safeguards, including firewalls and PCI DSS requirements, remain essential.
Security teams increasingly need AI to help detect and respond to AI-enabled attacks. The challenge is not simply having strong controls in place, but keeping pace with threats that are becoming more accessible and harder to identify.
3. AI agents could change how consumers shop
One of the biggest potential shifts is agentic commerce, in which AI assistants handle shopping tasks on a consumer's behalf.
Tools such as ChatGPT and Google Gemini point towards a future in which consumers can ask an agent to plan a trip, compare options and complete purchases, potentially using tokenised payment credentials.
For merchants, this could change how customers discover products and choose where to spend. A retailer's digital presence may need to be legible not only to people, but also to AI systems that search, compare and recommend options.
Structured information and technologies such as the Model Context Protocol (MCP) could play a role in this shift, helping AI agents find and interpret merchant information.
4. Digital convenience is changing spending habits
AI is only one part of a broader shift in shopping behaviour. On-demand delivery apps have made it easier for consumers to place smaller, more frequent orders, potentially reducing the impulse purchases associated with physical checkout aisles.
Retailers are also adapting their operations. Dark stores, facilities closed to the public and used to fulfil online orders, allow businesses to focus on fast-moving products and streamline fulfilment.
These changes show how digital commerce can affect more than the point of payment. It can influence basket sizes, product discovery, store formats and the economics of getting goods to customers.
5. Retailers must balance convenience with trust
The payments infrastructure may not need a generative AI overhaul, but the wider retail experience is changing quickly. Businesses face pressure to make shopping more convenient while protecting customers against increasingly sophisticated fraud.
Consumers, meanwhile, must navigate the tension between seamless digital experiences and security checks that can sometimes feel excessive.
For retailers and payment providers, the opportunity lies in applying AI where it can make a measurable difference: improving risk detection, strengthening cybersecurity and simplifying the customer journey without undermining trust.
AI's impact depends on how it is used. Its greatest influence on retail may not be in the mechanics of moving money, but in how people find products, make decisions and shop.
