Mastercard Sees New Growth in AI Payments, Cybersecurity and Digital Assets

Key Points

• AI-powered commerce could create new payment opportunities in consumer, business-to-business and machine-to-machine transactions. Mastercard’s Agent Pay framework is designed to secure agent-led purchases, with OpenAI and Spotify among adopters or partners; the company also reported up to 50% higher developer throughput in some areas using AI tools.
• Cybersecurity and fraud prevention are major growth areas. Mastercard says its Decision Intelligence Pro tools have improved fraud detection by up to 300% in certain high-risk sectors while reducing false positives, and it is investing in network security and modernization.
• Digital assets and acquisitions could extend Mastercard’s services. The BVNK acquisition adds crypto-native capabilities for moving money between traditional currencies and crypto, while Recorded Future’s threat intelligence can support fraud scoring and customer services.

Mastercard NYSE: MA sees artificial intelligence-driven commerce, cybersecurity and digital assets as opportunities to expand its payments network and services, President and Chief Technology Officer Ed McLaughlin said during a discussion with Citi fintech analyst Bryan Keane.

McLaughlin said the company’s global scale and acceptance network give it an advantage as new payment methods emerge, but he emphasized that adoption will depend on consumer experience, merchant value and regulatory compliance. “It has always been a highly competitive market,” he said.

AI and agentic commerce

McLaughlin described agentic commerce, in which AI agents can help consumers shop and make purchases, as a potential source of additional revenue. He said adoption is likely to develop over time as consumers decide where the technology is useful, rather than replacing existing payment methods all at once.

He also pointed to potential applications in business-to-business commerce and machine-to-machine payments. AI agents could make some transactions more dynamic, potentially turning activities that were previously handled through a single subscription into multiple transactions, he said.

Mastercard’s Agent Pay framework allows a secure payment token to be dedicated to an agent, McLaughlin said. It also includes tools intended to verify a consumer’s intent, identify agents to merchants and provide consumer protections. He said OpenAI, Spotify and others are adopting or partnering with Mastercard on the framework.

Internally, McLaughlin said all Mastercard developers have AI assistance for software engineering. In certain areas, the company has seen throughput increase by 50%, alongside fewer defects and better-quality work, he said. He attributed the results to training and adapting the tools to employees’ work, as well as providing access to them.

Fraud, security and network modernization

McLaughlin said AI is increasing the speed and scale of cyberattacks, while also providing defenders with more powerful tools. He argued that larger companies able to invest in security may have an advantage, and said Mastercard is investing in cybersecurity both to protect its network and to sell services to customers.

The company’s Decision Intelligence Pro fraud tools have improved fraud detection by up to 300% in certain high-risk sectors, while reducing false positives, McLaughlin said. He also described Mastercard’s AI-based decision management and fraud-fighting operations as a multibillion-dollar business.

McLaughlin said Mastercard has been modernizing its network by distributing processing geographically and using public, private and sovereign cloud infrastructure. The company is conducting end-to-end transaction authorization in Europe, he said, building on work in South Africa and other markets.

He said a majority of Mastercard transactions have been non-card-based for roughly six or seven years, citing tokenized, device-based and subscription payments. Mastercard’s share of its own transactions that it switches rose from about 60% around 2020 to more than 72%, he added.

Digital assets and acquisitions

McLaughlin said Mastercard’s acquisition of BVNK adds crypto-native capabilities to its existing services for moving money between traditional currencies and the crypto ecosystem. He identified cross-border payments and potential agent-to-agent transactions as areas where programmable digital money could be useful.

He also highlighted cybersecurity company Recorded Future, saying its threat intelligence gives Mastercard access to data that can improve fraud scoring and creates opportunities to serve customers, including government agencies.

Looking ahead, McLaughlin said Mastercard will continue to consider acquisitions that provide differentiated assets or data and can benefit from the company’s distribution network. He identified trust, scale, speed, security, resilience and employees as central to its technology strategy.

About Mastercard (NYSE:MA)

Mastercard Incorporated is a global payments technology company that operates a network connecting consumers, merchants, financial institutions, businesses and governments. Its network supports electronic payments, including transactions made with Mastercard-branded credit, debit and prepaid cards, as well as digital payment methods.

The company provides technology for authorizing, clearing and settling transactions. It also offers services related to cybersecurity, identity verification, data analytics, fraud prevention and payment consulting.

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