How NPCI should approach agentic payments

AI Agents might be allowed to make payments via India’s Unified Payments Interface (UPI), reports Business Standard. The National Payments Corporation of India, a private non-profit company that is not under RTI, which runs UPI, is working on a Unified Agent Protocol.

While the report is scant on details about how this agentic protocol will work, there is some precedence:

• Coinbase has the x402 protocol, which “enables AI agents to autonomously discover and procure third-party cloud resources, contextual data, and API tools—making it easier for them to achieve their targeted optimization goals without human-in-the-loop intervention.”…”This enables fully autonomous, AI-driven commerce—allowing goal-oriented agents to operate independently in an on-demand, permissionless economy.” As I said earlier, I’m glad they didn’t name the protocol x420. On a more serious note, Cloudflare, which is allowing publishers to charge to allow agents to access content, is using payments via x402 to enable access. Note to Cloudflare’s team: MediaNama is still waiting for approval. Nudge, nudge.
• Pine Labs launched an agentic payments protocol called P3P, though some questions remain unanswered about data sharing. The company open sourced its agentic Oauth framework, for authenticating agents, which is commendable, and typically, the path to making a framework acceptable. Agentic commerce suffers from the OpenAI vs Google protocol dichotomy, while MCPs have a universal protocol which nobody owns.

On a side note, inspired by a friend, I’ve given my AI Agent, Saki (named after this guy, who wrote wonderfully subversive short stories like this one), access to my credit card. Not made any agentic payments yet.

The reasoning: you get the OTP for completing a transaction anyway.

I guess the RBI was prepared for agents before they knew what agents are, even though 2FA caused much pain when it launched, and RBI has still botched international payments and doesn’t really care about people getting stranded when they’re out of the country, because RBI appears to think its god and is unaccountable, much like MEITY and DOT.

A few thoughts on how NPCI should approach agentic payments:

1. Trust: Agentic commerce fails because there is lack of trust. People in the US who have given their cards to agents have found, at least one person claimed, that an agent paid for a $2500 course influenced by an Instagram influencer. We need guardrails, recourse and reversibility, though that is tricky in India.
2. Identity:
   • Step one has to be to give agents their own delegated handles, or to make it even simpler, delegate a handle with agent or at agent. So something like agent-nixxin@ybl for me, or agent@nixxin@ybl for me. 
   • Separate agent PIN, on by default. Allow users to turn the off. The moment they turn the PIN off, limit goes down to default level, and users have to increase it if they want.
3. Limits: Step two should be to allow me to set…