PayPal and OpenAI sign ChatGPT payments deal

PayPal OpenAI has signed a deal with OpenAI to integrate its digital wallet into ChatGPT so users can pay for items found through the leading consumer AI tool, the company told CNBC exclusively.

The company’s shares jumped as much as 14% in pre-market trading on the news.

The agreement, struck over the weekend, means that starting next year, both sides of PayPal’s ecosystem can connect to ChatGPT: PayPal users can buy items through the AI ​​platform, and its merchants can sell on it, with their inventory listed there, according to PayPal CEO Alex Chriss.

“We have hundreds of millions of loyal PayPal wallet holders who will now be able to click the ‘Buy with PayPal’ button in ChatGPT and have a safe and secure payment experience,” Chris said in an interview.

The move makes PayPal an early part of OpenAI’s efforts to expand the use of ChatGPT for e-commerce. The idea is that its more than 700 million weekly users can rely on artificial intelligence to help them find items, similar to a human personal shopper. Last month, OpenAI said its users could buy from it Shopify and Etsy Merchants, and two weeks ago announced an e-commerce deal with Walmart.

“It’s a whole new model of shopping,” Chris said. “It is hard to imagine that proxy trading will not be a large part of the future.”

PayPal is trying to position itself as a payments backbone in the coming era of AI-driven agent shopping, announcing recent deals with… Google And the artificial intelligence company Perplexity. The fintech company, which also released third-quarter results on Tuesday, issued a statement about the OpenAI deal following the CNBC report.

The company will also manage merchant routing, payment validation, and other behind-the-scenes aspects of payment processing for PayPal sellers on ChatGPT, so individual merchants don’t have to sign up for OpenAI, the company said.

Chris pointed to the fact that the fintech company has verified consumers and merchants, which reduces the risk of fraud for either group. Users can withdraw funds from linked bank accounts, credit cards, or stored balances, to pay for purchases, and will receive protection, package tracking, and dispute resolution.

“It’s not just that a deal can happen,” Chris said. “It’s a trusted group of merchants, the world’s largest verified PayPal merchant network, with the largest group of verified consumers in a consumer wallet.”

PayPal also said it is expanding the use of OpenAI’s enterprise AI products for its employees to speed up product cycles.