Payment giant PayPal has secured its position as the first digital wallet integrated into ChatGPT, marking a watershed moment in the convergence of artificial intelligence and fintech that sent shares soaring as much as 14% in premarket trading on Tuesday.
The partnership, announced Oct. 28, will enable millions of ChatGPT users to complete purchases directly within the AI chatbot interface beginning in 2026, eliminating the need to navigate to external checkout pages. The deal positions PayPal at the forefront of what industry experts are calling "agentic commerce" — where AI-powered assistants autonomously handle product discovery, comparison and purchasing on behalf of consumers.
"Hundreds of millions of people turn to ChatGPT each week for help with everyday tasks, including finding products they love, and over 400 million use PayPal to shop," said Alex Chriss, PayPal's president and CEO. "By partnering with OpenAI and adopting the Agentic Commerce Protocol, PayPal will power payments and commerce experiences that help people go from chat to checkout in just a few taps."
The Mechanics of ChatGPT Commerce
The integration leverages OpenAI's Agentic Commerce Protocol (ACP), an open-source framework developed in partnership with payment processor Stripe. This protocol allows merchants to make their products discoverable and purchasable directly within AI conversations, fundamentally altering the traditional e-commerce funnel.
Under the arrangement, PayPal will handle multiple critical backend processes including merchant routing, payment validation and orchestration — eliminating the need for individual merchants to establish separate integrations with OpenAI. The company will support both instant checkout for consumers and payment processing through its delegated payments API for card transactions.
Users will be able to fund purchases through multiple payment methods already linked to their PayPal accounts, including bank accounts, stored balances and credit cards, while benefiting from PayPal's existing buyer and seller protections, package tracking and dispute resolution services.
Starting in 2026, the protocol will make product catalogs from tens of millions of PayPal merchants discoverable within ChatGPT conversations. This includes both small businesses and major retail brands across apparel, fashion, beauty, home improvement and electronics sectors.
OpenAI's E-Commerce Push Intensifies
The PayPal deal represents the latest in a rapid series of e-commerce partnerships for OpenAI. In September, the company launched Instant Checkout with Etsy, allowing U.S. users to purchase products from the handmade goods marketplace directly through ChatGPT. More than one million Shopify merchants, including prominent brands like Glossier, SKIMS, Spanx and Vuori, were subsequently integrated into the platform.
Most recently, retail behemoth Walmart announced a partnership with OpenAI in mid-October, enabling customers to browse and purchase products through ChatGPT. These moves position OpenAI as a potential competitor to established e-commerce giants Amazon and Google Shopping, with ChatGPT's 700 million-plus weekly users representing a massive potential customer base.
"It's a whole new paradigm for shopping," Chriss told CNBC. "It's hard to imagine that agentic commerce isn't going to be a big part of the future."
PayPal's Crypto Momentum Continues
The OpenAI partnership arrives as PayPal continues expanding its cryptocurrency capabilities, positioning the company to bridge traditional finance, AI and digital assets. The firm's dollar-backed stablecoin, PayPal USD (PYUSD), has experienced explosive growth, with its circulating supply surging to approximately $2.77 billion as of late October 2025.
That represents a 113% month-over-month increase from early October, making PYUSD the seventh-largest stablecoin by market capitalization. The token, issued by Paxos Trust Company and backed by U.S. dollar deposits and short-term Treasuries, has been expanded to over 13 blockchains through LayerZero's interoperability protocol.
PayPal has also expanded peer-to-peer cryptocurrency transfers in September, allowing U.S. users to send and receive Bitcoin, Ethereum, Litecoin and other digital assets directly within the PayPal app. The company currently offers 4% annual rewards for users who hold PYUSD in their PayPal wallets.
These crypto initiatives, combined with the OpenAI partnership, suggest PayPal is positioning itself as a comprehensive payment infrastructure provider for the next generation of digital commerce.
Strong Financial Performance Accompanies Announcement
The partnership announcement coincided with PayPal's third-quarter earnings report, which showed $8.4 billion in revenue, up 7% year-over-year. Transaction margin dollars rose 6% to $3.9 billion, while GAAP earnings per share jumped 32% to $1.30.
In a significant milestone, PayPal initiated its first-ever quarterly dividend of $0.14 per share, signaling confidence in its cash generation and long-term profitability. The company also raised its full-year guidance, expecting transaction margin dollar growth of 6% to 7% for 2025.
PYPL shares surged to above $80, reaching their strongest level since February 2025. The stock's positive momentum reflects investor enthusiasm about PayPal's strategic positioning in the emerging agentic commerce landscape.
Expanding AI Integration Beyond Payments
Beyond the consumer-facing commerce features, PayPal is significantly expanding its internal use of OpenAI's technology. The company is scaling access to ChatGPT Enterprise for its 24,000-plus employees and enabling engineers with Codex, OpenAI's AI-powered coding assistant.
This dual approach — integrating AI into both customer-facing products and internal operations — demonstrates PayPal's commitment to leveraging artificial intelligence to accelerate product development, boost employee productivity and enhance customer experiences.
Final thoughts
The PayPal-OpenAI partnership represents a pivotal moment in the evolution of online retail. As AI chatbots increasingly become the starting point for product discovery and purchasing decisions, payment providers and merchants that successfully integrate with these platforms may gain significant competitive advantages.
However, the shift also raises questions about the concentration of commerce power. Industry analysts have noted that if AI assistants become the primary gatekeepers of product discovery, the companies controlling these platforms could wield enormous influence over which products consumers see and purchase — a dynamic that has drawn scrutiny in traditional search engines and marketplaces.
For now, OpenAI maintains that its product recommendations remain "organic and unsponsored, ranked purely on relevance to the user." But as agentic commerce matures, the balance between user experience, merchant access and platform monetization will likely face ongoing examination.
With Bank of America Securities projecting that ChatGPT will handle approximately 20 billion shopping-related messages this year, the stakes for establishing payment infrastructure in AI-driven commerce have never been higher — and PayPal has positioned itself at the center of this transformation.