What AP2 Is

Google has introduced the Agent Payments Protocol (AP2), a framework that lets autonomous AI agents handle payments on behalf of users. AP2 covers a wide range of settlement methods, from credit cards and stablecoins to real-time bank transfers, and rethinks the checkout by formalizing AI intent into verifiable digital contracts.

How the Protocol Works

AP2 uses cryptographically signed mandates to record and trace the steps an AI agent takes when making purchasing decisions. Two core contract types power the system: Intent Mandates and Cart Mandates. Intent Mandates capture the user’s original approval and intent, while Cart Mandates represent the concrete items and payment actions tied to a purchase. Because each decision is cryptographically linked back to the user’s mandate, the protocol aims to create an auditable trail of authority and intent.

A Practical Example

In a typical flow, a user could instruct their assistant with a plain request such as ‘find a laptop under $900 and deliver it by Friday’. The AI would then search, negotiate terms with merchant agents, obtain the necessary approvals under the mandate structure, and complete the payment in a traceable manner. The process replaces manual checkout steps with automated, mandate-backed transactions.

Industry Collaboration

Google is developing AP2 alongside more than sixty major companies, including Mastercard, Coinbase, PayPal, and Etsy. The goal is to build an ecosystem where customer agents and merchant agents exchange secure, standardized messages so transactions feel seamless while remaining accountable. Google has also extended collaboration with PayPal, aiming to weave AP2 capabilities into existing services like Google Cloud, Ads, and Play to leverage familiar payment rails.

Risks, Security and Compliance

Despite its promise for convenience and speed, AP2 raises substantial concerns. Analysts warn that misinterpreted instructions, compromised agents, or sophisticated fraud schemes could amplify existing payment risks. Adoption will rely heavily on whether businesses and regulators trust these digital mandates to protect consumers and merchants alike. Legal, compliance, and fraud-detection mechanisms will be essential to prevent misuse and to allocate liability when something goes wrong.

Market Reaction and Implications

Investors are watching closely: Alphabet’s stock has benefited from enthusiasm about AI initiatives this year, and AP2 is viewed as a potential driver of ‘agentic commerce’. If the protocol works at scale, it could transform everyday shopping by letting AI negotiate, choose, and pay for purchases on behalf of users. But trust remains fragile — a single high-profile error could slow or reverse adoption.

The Big Question

AP2 presents a future where your AI can handle everything from deal hunting to final settlement. The remaining question is whether users, businesses, and regulators will accept that level of delegated financial power. Would you let an algorithm shop for you while you wait for the delivery?