India has launched a national pilot project that allows consumers to shop and pay directly through AI chatbots, with OpenAI’s ChatGPT leading the initial rollout. Integrations with Google’s Gemini and Anthropic’s Claude are currently in development, signifying that the South Asian nation is emerging as the next major market for global AI companies.
The Agentic Payment Infrastructure
On Thursday, the National Payments Corporation of India (NPCI), the federal body overseeing the country’s massive Unified Payments Interface (UPI) network, partnered with OpenAI and fintech firm Razorpay to enable this commerce through ChatGPT. Razorpay confirmed that the pilot is being rolled out nationwide and is expected to become widely available to consumers in the coming months.
The entire experience is built on two new NPCI protocols: UPI Reserve Pay, which allows users to reserve a specific amount of funds for future debits to designated merchants, and UPI Circle, a solution that delegates UPI authentication. These innovations allow payments to be completed directly within ChatGPT without the need to switch to external apps or websites. Razorpay is responsible for developing the crucial merchant integration layer that enables businesses to process transactions through the AI chatbots.
The initial merchant partners for the new pilot are Tata Group-owned online grocer BigBasket and telecom operator Vi, allowing customers to shop for groceries or purchase mobile recharge plans entirely through the ChatGPT interface. Additionally, Axis Bank and Airtel Payments Bank are providing the underlying banking layer for the transactions.
Harshil Mathur, co-founder and CEO of Razorpay, emphasized the scope of the innovation, stating, “It’s not just a payment experience. It’s a whole new discovery and commerce experience.” UPI is already a massive success in India, processing over 20 billion transactions every month, but this new AI-led system could help the NPCI drive further adoption by seamlessly embedding UPI into everyday commerce.
Competition and Global Outlook
The agentic payment experience is quickly expanding beyond ChatGPT. Mathur confirmed that Razorpay has already completed a proof-of-concept for the new system with Google’s Gemini and Anthropic’s Claude, with these integrations expected to go live for consumers in a few weeks. Razorpay is also actively negotiating with additional merchants and anticipates a broader rollout across the country in the next couple of months.
India, the world’s most populous nation, is already one of OpenAI’s top markets for ChatGPT, which the company has been targeting with localization efforts like the sub-$5 ChatGPT Go plan. Similarly, both Google and Anthropic are seeing a surge of new users from India. While Google has a deep local presence through products like Android and YouTube, OpenAI and Anthropic are rapidly establishing a physical footprint and localizing their AI offerings for Indian users.
India’s current plan for agentic payments does not include a specific revenue-sharing model for the AI partners, but the move will help companies like OpenAI achieve greater user retention by making their chatbots more functional. Mathur confirmed that the AI companies will not gain access to the payment data under this new setup, and users will maintain security control by pre-authorizing the amount transacted through two-factor authentication.
The Future of Conversational Commerce
This Indian pilot aligns with recent global moves by major tech companies. Last month, OpenAI introduced an “Instant Checkout” feature and its Agentic Commerce Protocol (in partnership with Stripe) to help businesses connect with consumers via AI agents. Likewise, Google launched its Agent Payments Protocol to allow AI agents to make transactions on behalf of users. Reeju Datta, co-founder of online merchant payments startup Cashfree Payments, which has launched a competing agentic payments solution, noted the immense potential: “This is still an early, forward-looking concept, but one with tremendous potential. Its adoption will naturally grow in line with how fast shopping agents take off.”
Author’s Opinion
India’s decision to build the world’s first UPI-integrated conversational payment system directly into AI chatbots is a stroke of regulatory genius that immediately positions the country as the global leader in practical, secure AI commerce. By leveraging its vast mobile-first population and its trusted payments network, the NPCI is forcing global AI giants to localize and integrate, ensuring that the next major evolution of e-commerce is not dictated by American tech platforms alone, but is built on India’s open, secure financial rails. The success of this pilot will establish conversational AI as the primary interface for digital transactions, revolutionizing commerce across the global south.
Featured image credit: Arjan Billan via Unsplash
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