This is part 4 of our Agentic Protocol for Ecommerce series. 

Read Part 1: The Universal Commerce Protocol (UCP): What It Is and Why It Matters for Ecommerce

Read Part 2: The Model Context Protocol (MCP): The Agentic AI “USB-C Port” for Ecommerce

Read Part 3: Agent2Agent (A2A) Protocol: Enabling AI Agents to Transform Ecommerce

Agentic AI is fundamentally changing how people find what they need, discover brands, and shop online in a transformation that may be comparable in magnitude to the shift from brick-and-mortar retail to ecommerce in the late ‘90’s to early 2000’s. 

Google search bars and product pages shifted us into an “Assisted Commerce” era, where online stores are optimized to be visible and easy for humans to navigate, whereas generative AI and AI bots are shifting us into a new “Agentic Commerce” era. 

That said, this transition has faced a glaring infrastructure barrier: the inability of agents to securely and autonomously transfer value. While agents have become adept at reading data (via Large Language Models) and communicating (via APIs), they have lacked a secure "wallet" that functions without a human pressing a button.

Thankfully, protocols like the Agent Payments Protocol (AP2), developed to address these problems, are quickly gaining traction as more people and brands become interested in agentic commerce and AI shopping assistants. 

In this blog, we’ll break down what AP2 is, how it works, and why it’s so important for ecommerce merchants looking to stay relevant as we head into this new era of commerce. 

What is the Agent Payments Protocol?

The Agent Payments Protocol (AP2) is an open, non-proprietary protocol designed for the emerging “Agent Economy,” enabling AI agents conduct payments on behalf of users in a secure and standard way. In simpler terms, it’s a set of rules and technologies that let a user’s AI assistant buy things from any AP2-compliant merchant with confidence and security.

AP2 was introduced in 2025 by Google, in collaboration with over 60 partners, including major payment networks such as Mastercard, American Express, and UnionPay, fintechs, and ecommerce players. It’s released under the Apache 2.0 open-source license, meaning any platform or developer can implement it. This broad industry backing suggests AP2 could become a universal standard for agent-initiated payments.

AP2 is an extension of the Agent2Agent (A2A) protocol and the Model Context Protocol (MCP), establishing a payment-agnostic framework for users, merchants, and payment providers to transact with confidence across all types of payment methods. 

Why is AP2 Needed?

Traditional online payment systems assume a human is directly clicking the “Buy” button on a website. With autonomous agents shopping for us, that assumption breaks, raising questions that current systems can’t really answer:

1. Authorization: How do we prove a user actually gave the AI agent permission to make a specific purchase?

2. Authenticity of intent: How can the merchant be sure the agent’s order truly reflects the user’s real intent and isn’t some AI error or hallucination?

3. Accountability: If something goes wrong, who is accountable? The user, the agent/its developer, the merchant, or the payment provider?

Without a protocol like AP2, these uncertainties make it difficult for humans to trust agent-led transactions (i.e. purchases made via AI shopping agents). Shoppers may hesitate to let AI agents spend their money, and merchants risk fraudulent orders or disputes if they can’t verify an agent’s legitimacy. Without addressing authorization and intent verification, AI-driven commerce might fizzle out, even though agentic transactions have a lot of potential.

Another risk associated with a lack of these kinds of AI system protocols is fragmentation. Without standards like the Agent2Agent Protocol and AP2, every company might devise its own proprietary way for agents to pay. This would lead to a fragmented ecosystem: confusing users, expensive for merchants to integrate multiple systems, and hard for banks to manage risk consistently.

How Does AP2 Work?

Using tamper-proof cryptographic mandates, AP2 supports both real-time purchases and delegated tasks in which agents act autonomously. Since it’s an extension of the A2A protocol, AP2 works off the A2A’s capabilities that enable communication and collaboration between AI agents across different platforms and frameworks. 

This means that while a human user can ask an AI to book a vacation in Mexico, the agent can then interface with airline and hotel agents to complete the task behind the scenes. Similarly, it enables agents to support various payment methods, such as credit cards, stablecoins, and bank transfers, allowing shopping assistants to transact in a myriad of ways for human shoppers. 

When a human shopper asks agentic AI to shop for an item, the request is captured in what is referred to as an Intent Mandate. The agent will build a cart based on the prompt given and present it to the user. When the user is happy with the cart presented, their approval will sign a Cart Mandate, thus creating a secure, unchangeable record of the items and their respective prices. The payment can then be processed by the merchant and payment provider. 

Similarly, users can also use AI tools to delegate shopping tasks that don’t happen right away. For example, a shopper could ask their AI shopping agent to monitor their favourite shoe brand’s website and submit a preorder for a limited-edition drop the second it goes live, so they don’t miss out. This prompt will sign an Instant Mandate in advance and will specify the specific rules for when a transaction should be completed (price limits, timing, conditions, etc.). 

Why AP2 Matters for Ecommerce Merchants

The Agent Payments Protocol acts as a layer that ensures that once an agent finds a product via the Universal Commerce Protocol (UCP) and uses its tools (via MCP), it can also complete the purchase via AP2. This trio (UCP, MCP, AP2) forms a foundation for end-to-end agentic commerce.

Open standards/open protocols like this are the only way forward for building the foundations of how AI agents communicate and interact with each other in real-world agentic shopping scenarios. This means that as an ecommerce merchant, if your store isn’t set up to be discoverable and shoppable by AI, you will begin to lose sales to brands that are. 

AP2 could unlock novel shopping experiences that drive sales in ways traditional ecommerce can’t. For example, agents can monitor inventory and price changes and execute purchases instantly when conditions meet a user’s desire, capturing sales that would’ve been lost if the user weren’t actively online. 

Similarly, merchants could leverage personalized offers via agents: if a merchant’s own AI detects a shopper agent looking for a product urgently, it could respond with a custom bundle or discount, turning a simple inquiry into a bigger sale.

We also can’t discount the improved customer experience this style of shopping affords our customers. Frictionless commerce is a big promise of AI agents. With AP2, customers could delegate routine purchases or complex tasks to their agents, who would complete them quickly and easily. For merchants, this means reduced cart abandonment and potentially higher conversion rates on high-intent purchases.

Conclusion

The Agent Payments Protocol envisions a future in which AI agents help consumers find exactly what they need and make purchases quickly and easily on their behalf. By establishing a secure, standardized method for agent-led transactions, AP2 is building trust in a new way of shopping. For ecommerce merchants, it’s a much-needed solution to ensure any AI-driven sales are legitimate and safe, and it’s an opportunity to tap into emerging sales channels driven by AI recommendations and automation.

We’ve seen how AP2 works in tandem with protocols like UCP, A2A, and MCP to cover all aspects of agentic commerce. We’ve also seen that major industry players are on board, signalling that agent-based shopping is about to become a reality. As agentic commerce evolves, we expect more tools, libraries, and platform support to make adopting protocols like AP2 easier, much as mobile payments and social media integrations have become commonplace over time.

In the meantime, now is a great time to familiarize yourself with AP2 and experiment. Even if your customers aren’t using AI agents to shop today, they very well could be in a year or two. At Blue Badger, we love testing out these new technologies and using them to deliver real value for our clients. Get in touch with us today to get started with agentic commerce