india pilots ai chatbot-led e-commerce with chatgpt, gemini, claude in the mix

India Launches AI Chatbot Commerce Pilot

A new pilot program has been initiated in India, allowing consumers to make purchases and complete payments directly through AI chatbots. OpenAI’s ChatGPT is spearheading this rollout, with integrations for Google’s Gemini and Anthropic’s Claude currently under development. This positions India as a key market for leading global AI firms.

UPI Integration Drives the Innovation

The National Payments Corporation of India (NPCI), responsible for the widely adopted Unified Payments Interface (UPI), has collaborated with OpenAI and Razorpay to facilitate this direct shopping and payment functionality within ChatGPT. Razorpay has confirmed to TechCrunch that the pilot is being deployed nationally and will be broadly accessible in the coming months.

This system leverages UPI Reserve Pay, a new NPCI protocol enabling users to earmark funds for future transactions with specific merchants. It also utilizes UPI Circle, which delegates UPI authentication, allowing payments to be finalized directly within ChatGPT without redirecting users to external applications or websites. Razorpay has engineered the merchant integration layer for seamless transactions via AI chatbots.

Initial Merchant Partnerships and Banking Support

BigBasket, the online grocer owned by the Tata Group, and telecom provider Vi are the first merchant partners participating in this pilot. Customers can now purchase groceries or mobile recharge plans directly through ChatGPT. Axis Bank and Airtel Payments Bank are providing the necessary banking infrastructure.

India: A Prime Market for AI Growth

As the world’s most populous country with over a billion internet users, India is already a significant market for ChatGPT. OpenAI introduced a ChatGPT Go plan priced under $5 in August to attract a wider subscriber base. This commerce pilot is a strategic move to enhance user engagement and capitalize on India’s rapidly expanding digital economy.

According to Razorpay co-founder and CEO Harshil Mathur, this initiative represents more than just a payment solution. It’s a completely reimagined discovery and commerce experience.

Expanding the Ecosystem

UPI already processes over 20 billion transactions monthly, serving as India’s dominant digital payments platform. Integrating UPI into everyday commerce through chatbots has the potential to further increase adoption.

Razorpay has successfully completed a proof-of-concept with Google’s Gemini and Anthropic’s Claude, with these integrations expected to become available to consumers within weeks. The company is also actively engaging with additional merchants beyond BigBasket and Vi, anticipating a wider rollout in the near future.

Global AI Companies Expand Their Presence

Similar to OpenAI, both Google and Anthropic are experiencing a surge in users from India. While Google already has a strong local presence with products like Android, Search, and YouTube, OpenAI and Anthropic are now focused on establishing a foothold in the country and tailoring their AI offerings to Indian users.

Data Privacy and Revenue Sharing

Currently, the pilot program does not include a specific revenue-sharing arrangement for participating partners. However, it is expected to contribute to increased user retention for AI companies like OpenAI.

Razorpay has confirmed that AI companies will not have access to payment data, and all transactions through chatbots will require two-factor authentication for user authorization.

Agentic Commerce Protocols

OpenAI recently launched an “Instant Checkout” experience and its Agentic Commerce Protocol, developed in collaboration with Stripe, to connect businesses and consumers via AI agents. Google has also introduced its Agent Payments Protocol to enable AI agents to execute transactions on behalf of users.

Reeju Datta, co-founder of Cashfree Payments, notes that this is an early-stage concept with significant potential, and its adoption will correlate with the growth of shopping agents.

Cashfree Payments Joins the Agentic Payments Landscape

In addition to Razorpay, Cashfree Payments has launched its Agentic Payments MCP, enabling merchants to facilitate payments directly through their shopping agents. Cashfree’s solution supports various payment methods, including cards and UPI. However, merchants using Cashfree must independently develop shopping agents to integrate with the MCP.

The company showcased the functionality through a demonstration featuring a chatbot enabling a user to purchase an iPhone.

Datta indicated that they are exploring this technology with several large enterprise merchants across sectors like e-commerce and lending, but declined to disclose specific names.