1016. Insights: Is agentic commerce the future of payments? Live from Paris with J.P. Morgan

0:14Hello and welcome to Fintech Insider Insights, live from JP Morgan's Roadshow here in Paris. My name is David Brea, I'm the Group CEO at 11FS, and today in partnership with JP Morgan, we're going to be exploring how payments are being reimagined, not just at the checkout, but across the entirety of the financial stack. Commerce is no longer something we do, it's something that just happens, often silently, and often even without us really noticing. Welcome to the age of agentic commerce. From the frictionless frontiers of e-commerce to the the precision and pressure of corporate treasury, we're mapping the modern payments journey, one shaped increasingly by automation, intelligence, and user intent.

0:58We're gonna be unpacking what a Gentic e-commerce actually is, what it means in practice, and the evolving cart-to-code setups around many businesses all around the world. We're also gonna be taking a little bit of a look about how regulatory shifts across the entirety of the EU are really rewriting the rules for builders and banks alike. We'll also look to explore the enduring complexity of cross-border payments and the innovators working to make movement and seamless as intended to be. We're going to be charting how the payments experience is no longer just about speed of cost, but context, control, and connection.

1:39That was a really long intro, wasn't it? We should probably get into it, eh? I'm joined as always by a really great group of people. And as we're in the city of love and talking to you guys before, people are very passionate about all of these things that we're going to be going about. So first up, we've got a Fintech Insider debut for Ludwig Uri, who is the Managing Director, Head of Merchant Services, Emir, APAC, and Global for Large Accounts at JPMorgan. Your cards must be like six feet tall. Like, do you have to fold them to get them in your pocket? We don't do cards anymore. We don't do cards anymore.

2:14So it's easy. Yeah, it's very true. digital and green very good um how you doing good thank you for having me yeah after the the intro you've made i don't know what else can i ask yeah well we covered a lot of ground there quickly didn't we but um tell for the audience uh tell us a little bit more about your role at jp morgan sure well as you said i'm in charge of the merchant services business at jp morgan which means in a way to uh to allow merchants to accept means of payments in particular cards we are specialized in cards and I run this business in Europe and in APAC. And you had the full title, so I have to mention it.

2:55I'm also in charge of the relationship management of the large key accounts we've got in the world. I feel like a man with many air miles potentially. Indeed. As an ex-consultant, I can share your pain of extensive knowledge of taxi trips to hotels or airport lounges. And what I can add is that I've been doing this job for JP Morgan for three years now, but I've been in this industry for close to 30 years. Wow. I mean, even in the last three years, the change is quite phenomenal, isn't it? A lot has changed. We'll touch on that as we get into it then. Okay, next up, we've got another FinTech Insider Daily.

3:34We've got Lauren Lecomte, is that right? Director of Global Payments, Risk and Fraud at Backmarket. How are you doing? I'm fine. We're sitting in your super duper office as well. Like very, very cool space. I have to say I'm very jealous. I hear there's lots of sort of secret rooms and different things. Yeah, it's a speakeasy office and there is a speakeasy nightclub downstairs. Well, there's a promise. I feel like we know what we're doing directly after this then, right? But for anybody who doesn't know, tell us a little bit about the business. Tell us a little bit about your role. So, Back Market is a pure-player marketplace that's specialized in refurbished devices.

4:16So, it means that we are the intermediary between professional refurbishers and consumers. We are having B2C, C2B, and B2B activity. However, the vast majority of our transactions are B2C. It was created in 2014, so a bit more than 10 years ago, in France by French people in Paris. And now we are in 17 countries. And I started to work for back market at the very early stage. And I grew up basically with the company. My team grew. I learned a lot about international expansion and new services, both for consumers and sellers. and it's tremendous time to be in payment at the moment because there is a shift of industry, especially for marketplaces around AI.

5:11So, we're happy to go through it today. Well done. Great to grow up with the business. I've been running 11FS for 10 years and I've been resisting growing up as well. So, I figure if you can avoid that for as long as possible, it's good to do, isn't it? So, last and by no means least, We've got Lidi Convert, head of cash management at BlablaCar. How are you doing? Fine, thanks. Tell us a little bit more about BlablaCar and your role. Okay, BlablaCar is a leading carpooling platform and now we operate also bus, seas and trains. And my role is I oversee our global liquidity and payment for all markets.

5:54It's about 22 countries now. And that's only one year and a half. But before I was in digital market also with Deezer, you know, the streaming platform. And after, so I was in industrial and boring company. Yeah, we've all had one of those, haven't we? Well done for not naming them. That was good. But that's awesome. Well, great panel with great experience to sort of dive into all of these different things. I guess, you know, it's on the tip of everybody's tongue. Any conference you go to, I've just come from Web Summit. I think it was like 49 ,000 people talking about AI, basically. What do we think it is?

6:36What actually is it? Because it's such a broad church of subject matter that people seem to use it interchangeably for discussing a back office risk change to a front office customer experience improvement. So do you want to start us off with this one? What's AI? What's a GenTik? What does it do? So AI specifically, the first thing is exactly what you say. Cheaper, faster, more accurate to solve things that are not necessarily very interesting, like in operational stuff, in replacing things that are extremely manual or improving the efficiency of fighting fraud, for example. But indeed, the evolution now in our world, the buzzword is around agentic commerce.

7:26I knew you would ask the question. and I've been thinking what is the best way to kick off this conversation on agentic commerce and I think we need to say first of all that we've got two giants that have got a very strong position in search and they are thinking how can I monetize commerce while people come through me to look for product. So that's one starting point. The other starting point is the merchants, the marketplaces, how will they be part of this? How will that work? And that's this ecosystem that needs to be built. And recently what we have seen is our moves from both OpenAI and Google to try to start a standardization of agent e-commerce in light of protocols, catalogs, payments.

8:40And basically everybody now is assessing, analyzing, how do I play with this? And just to complete this first part, because I'm sure that my colleagues have other things to do. It is not today the ability of an agent to go and buy for you 100 % without you knowing. We are not yet there by far. Yeah, it's a shame because that would be nice, right? If it could do my weekly shop, that would be awesome. But like you say, we're sort of hurtling towards that reality. What do you think? I mean, how do you use AI on a day-to-day basis? Is it sort of landed on your home screen on your phone already? Or is it far off from that?

9:33I'm super in line with what Ludovic said. Basically, AI is a buzzword today, but we have been using AI for years now. It's just some kind of advanced machine learning, right? We have been using it for smart routing, for fraud management, etc. The very big difference is LLMs, so basically ChatGPT and co. And we are using JNI today at back market for enhancing productivity. There are a lot of things like defending chargebacks, for instance, that can be done thanks to agents. But also it goes way further in terms of fraud management. One example is that we are using Gen.ai to compare some after-sales messages from clients.

10:23And if we see the same message from an Italian guy in Roma and a French guy in Lille or whatever, and we just translate and we see that it's exactly the same message. Basically, this is just one ring of fraudsters. And it's really a key differentiator compared to a few years ago. And now, as Ludovic said, we are definitely looking at agent AI because it can disintermediate us if we don't surf the wave. So it's both an opportunity for back market to be pioneer of this new kind of transactions. And as well, we can miss some businesses if we are not there yet. Yeah. Yeah, it's interesting that point on changing commerce, you know, for a whole generation, you know, you run to Google, you type the thing in, you get search engine results, pages, you know, that's where, you know, ads are served and you can engage with it, right?

11:29And the battle around search engine optimization and all of those things, it's kind of like a no-known. But in a world where people are using OpenAI as their interface to actually the ability to find new customers, engage with them, it's a different battleground, isn't it? But I guess digital in the first days was how do we take people, how do we take paper, how do we take buildings out of the process? So it's sort of a similar battle, but shifting battleground to a certain degree, right? But it's, I'm really in agreement with what Lauren just said. That's good, because you sat next to each other.

12:08It'd be real awkward if not. But it's very important to understand that if marketplaces or merchants don't embrace the way it's going to be designed, the search engine or the agent will not go to them. will not provide the consumer this opportunity. And this is really a potential shift of the commerce. It's weird, isn't it? I mean, traditionally, product manufacturing, product distribution, you know, actually it's an intermediary for distribution or access to consumers, isn't it? But by the way, we would like to help the ecosystem to play in a fair and agnostic way. We think it's very important.

12:54Not only we are going to provide solutions so the marketplaces and the merchants can participate in an agnostic way to retain the payment and the role of merchant of record or marketplace of record that they've got today. but also the way the catalog is positioned, since we are going to be in the middle of commerce, I think we are going to be able to build a lot of experience and share it as much as we can. But here you're talking about enhancing customer experience and for sure there is some tremendous challenges here. But I also want to emphasize the fact that it will definitely change our fraud management.

13:40Because today we are using data to see how people navigate through a website, how long they are staying on one page, are they copy pasting some kind of data, etc. With agents, we don't know yet what will be the behaviors. We don't know yet what will be the API, the protocols. And also, we must remember that fraudsters are going to use agents as well. Pretty innovative fraudsters. Yeah, yeah. So it will be kind of a machine against machine world in that sense, in terms of fraud management. And we really have to secure and think about the fraud aspects very much. When you're talking about how GP Morgan can help merchants and the industry, in that sense, fraud management is absolutely key here.

14:35How about you? What is sort of agentic AI touching your day-to-day life at this stage? Is it something that you're personally engaging with or from a professional perspective? Yeah, about AI we use in Treasory because there is a lot of impact. We talk often about automation, but I prefer to speak about new decision layer, you know, the capacity of AI to manage data and support us to make easier, faster all our manual tasks. And AI can just help us to make more proactive decisions. So that's a point. And for authentic commerce, not existing yet for Black Car, but it's a process. Okay, and if we believe McKinsey, it will be half of B2C transaction in 2030.

15:29So it's key to be on it. And but it's very important to not lose compliance, trustability and all that stuff to control. Don't trust management consultants. They always put out big numbers just to make people do stuff. But yeah, I'd say your point. But I mean, it's interesting, isn't it? like we're sort of circling around, you know, commerce has been around forever. Do you know what I mean? People have been exchanging like pebbles for stuff, you know, like all cows, whatever, you know, like, so there's a sort of a inherent trust that needs to be in all of these systems in order to, for them to be accepted.

16:07But like, how do we manifest that in this world when the way in which we're engaging with the people that we're trying to, you know, procure things from a very different, like how do you sort of main trust in this this world um no i think it's it's going to be um it's unknown today how the catalogs can be built in a way to be still in control of the action of selling however it will be known very soon and very soon um we will have to i mean they will have to uh to have the technology in place. So when the searches of agents are going to start playing, they get action already and called upon as a possibility, as a potential product or service to be sold.

17:04We have seen already some protocols issued by Google and OpenAI. I think you will see some POCs in the coming months, probably in Q1. I would not be surprised if there is a ramp-up of pilots in Europe, in America, where companies will be able to assess the role they play and will be there to support them. Yeah. I just wanted to give one news case so that it makes things maybe easier. So basically, if David wants to buy a MacBook Pro, he will tell his agent, okay, I want to buy a MacBook Pro in the next two days at£600, and I want to have it delivered at my place in less than one day. And so you will have specific data that will be in the protocol.

18:01And basically the agent can run through, I think the right word is crawl, will crawl a lot of websites. and it will at a specific time when the price of one MacBook goes down to£600, then the transaction is initiated. So it can be initiated at any time of the day, during the night, etc. So from my understanding, that's where we are going. This will work if your catalog is addressing exactly to the protocol the agent is going to be searching. Yeah. And also the agent is going to look for catalogs where he knows that the payment protocol at the end will be matching. Embedded, yeah. If not, then he will not offer the solution.

18:49And that's really the point I was going to make, which is this sounds amazing. If I do want a new laptop, thank you, that would be great. But if something could go and do that for me and actually make sure that I was getting the best deal and exactly what I wanted 24 hours a day, that sounds amazing. You know what I mean? Like it's like a stone's throw from having like a robot in my house dealing with all my things as well, you know, but, but I, I guess there's a, um, you know, AI is not a panacea, you know, it's not a, it's not a fix all for all of these things because, you know, actually there's, there's pretty strict, uh, regulation around data.

19:25There's the need for really great straight through processes across all of these capabilities that we want to expose. So, you know, not having those things in place and just slapping some AI on it isn't going to solve the problem, is it? So, I guess, you know, data structuring, data regulation plays probably a big part to play to get that right first. Yeah? Yeah. You mean ISO 2022, for example? Yeah, but so many different regulations around data that govern how you can use it, how you can structure it, what you can engage with it, you know, so it's because actually at the point where you're acting like a personal shopper for somebody in that confines, then the customer has had to give you permissions to retain and use that information as well, right?

20:15Yes, to keep the traceability of consent, the clear user traceability, identity. That's the key point with identity commerce. So it's too technical for me to speak about the previous steps. But yes, we need to keep that for reconciliation. That's my scope. And I hope so that, yes, all the structured data and unique reference ID to trust, to re-label, to make some, every transaction is easily trustable in our system. It's a real change for our company, for Trezor's perspective. It makes some reconciliation become fully almost automatic. And I can't about AI to learn patterns and to solve exceptions.

21:10So yeah, that's the reason why I think the switch with this kind of structured data is to move also how my job about the past to move from end of the day to intraday cache visibility, to intraday cache control, and to make more active on a day-to-day basis. That's the whole point, that to move from execution, orchestration, that's the big world for the coming months, coming years. Well, that sort of batch, end-of-day batch structuring to a 24-7, 365 real-time view of that is amazing. But, you know, as I was saying about the, straight through processing structuring of those things like you know these things will be in place to be able to expose it to enable that world as well right you know it's important to say that the monetization system is not known today the other thing to notice another angle visa and mastercard who are going to create the rules for the the banks at issuing level to create the credentials and the way to tokenize the transaction for the agent so that the agent at one point will be free.

22:31It does not exist yet. So this is still in the making. So right now, we are driving into the zone where the catalog will be created. there will be a protocol for the transactions, but the consumer still have the duty to decide, yes, I want to buy, no, I don't want to buy. We are still in this position. So for, I don't know how long though, a certain period of time, there will be some kind of learning curve and control. I mean, it's similar to cars, isn't it? You know, we've seen, you know, cars that can park themselves and we were all really excited and now they're driving themselves. And it's like slowly but slowly things, the technology advances and our trust in the systems improve, don't they?

23:22So, sorry, you're going to jump in. Yeah, I just want to insist on your last point. So basically today, there are several types of transactions. There are the customer initiated transactions. So it's David buying a MacBook Pro. You're really keen on me buying that laptop, aren't you? I feel like you're on some sort of commission for Apple now. Great website. And merchant initiated transactions. So this is for any recurring type of business or tokenization, as you mentioned. And there will be a new type, which is agent initiated transactions. And here we don't know yet what will be the authentication of the customer.

24:05And coming back to your questions regarding data compliance, etc. etc. Today, the law is different for customer-initiated transaction and merchant-initiated transaction in terms of 3DS and all that stuff. So what will be the case for agent-initiated transaction? We don't know yet. It's super blurry. Yeah, it's going to be super interesting, isn't it? You kind of think in the context of payment initiation, all of the liabilities around who was liable in PSD2. We still haven't haven't quite worked out all of that gray area. Exactly. So, yeah, if suddenly your agent, which you might have many of, looking out into different technologies in order to buy on your behalf, then ultimately, is it at you or is it them?

24:53And where does the risks it? It's, I feel like we're not going to get to the end of that question in this podcast, because it's quite a big one. But we covered a load of ground here, guys. Like, you know, from basically, we're never going to talk to each other and all of our agents are going to be talking to each other to all of the sort of data restructuring. Anything stands out other than isn't technology scary? Or any questions that you have or comments that you have? I can go if you want. Yeah, go on then. Jump in. I think back to the point of physical shopping, it's not really a pain question, but not of that.

25:27Customers, they have your questions. Do we really think that we're going to be okay to do the joy of shopping, just like we We lost the joy of driving in a way. I think it's key of the Pembering experience and the economy's experience into it. Yeah. Wait, do you mean as in like physically going into a place? I think, for now, we're still keen and saying yes. Yeah. Yeah. And we don't know. Do you, I mean, I haven't been in a shop for such a long period of time, if I'm honest with you. Like, I feel like I'm the prototype Amazon customer. Do you know what I mean? It's like the amount of recycling I'm doing of those brown boxes is just not good for the world.

26:05You know what I mean? So I kind of feel like it's not that big a leap for me, but what do you guys think? What I can see is that today, there are some markets where we need to open a store or a showroom so that customers can see the device and touch them and compare them to new devices, refurbished versus new. I'm not sure that people will stop shopping at all in physical stores because there will be some resistance that will still want to try and test physical stuff. Yeah, interesting question. It depends on what is sold. If a travel business, I think there is no same link, you know, with personal and physical.

26:58It raises a question about our brand, our marketing campaign, what is BlaBlaCar will be in a few years if agents in commerce make all transactions. And we just chose by an agent and robot and we become B2B. Yeah. Well, I guess the, with the plan on the, the agentic side is that essentially your agents would look at brands that you have an affiliation to. Like I'm a sucker for Nike. So I'm like, you know, I believe in Nike. I don't believe in Adidas. So like buy, you know, buy me Nike stuff, don't buy me Adidas stuff or whatever. So it's like actually brand affiliation becomes really important, doesn't it?

27:44So the, but yeah, your point, the distinction between brand awareness this marketing is going to be weird, isn't it? You'd have to do more physical sponsorship of events where people are present rather than it being just who's at the front of the store. It's a super interesting point. Are you ready to give up shopping in physical places? I'll be honest with you, it's nearly Christmas and it terrifies me having to go do that. You can add to the point that I was thinking about that we've went from physical to digital after COVID. it, I think as in commerce, would probably trigger the way back in a bit.

28:20We need to physically have an emotional experience with the brands because we don't know that we didn't ask. Yeah. Well, and also that's a really good point. The sort of the physicality of those things is like the research, you know, me knowing I want that particular laptop, the research process is a very different stage of the buying process than the physical purchasing one so you know the uh you know i'm a i'm an obsessor like holidays i'm an obsessor i like to research everything about a thing before i make that leap you know same with a laptop like i'm uh crazy into the detail of like the you know gpu or whatever in it in terms of picking it but then the actual purchase bit it makes you wonder what the what the payoff is you know because actually the the physical trade-off of pressing that button and getting that dopamine kick of uh i bought the thing will you still get the same association with it or not that's that's why you were talking about nike um that's that's why a lifestyle brand will be uh really important and at back market we uh we are we invest a lot of efforts uh in um manifesto and uh everything about climate tech and uh climate talks uh conferences etc we don't want people just to buy a macbook We want people to buy a MacBook from back market because it's refurbished.

29:43Sure. And be proud of it. Yeah. And that's the brand affiliation. Exactly. But it goes back to that point on distribution again, doesn't it? You know, at the point where, you know, millions and millions of users are using it as the way to engage, then, you know, eventually the market, the demand takes over, doesn't it? All right. Well, a good question, though. Thank you very much for that. So back to his question regarding physical stores, that's why also we didn't just open a showroom. We are also hosting events and conferences in the showroom. So it's not just a physical store where you experience a purchase.

30:19It's also a place where people gather and speak about a specific topic. Cool. All right. That is going to wrap up the first half of the show because we better get through to the thousand other things that we want to talk about in the second half of the show. So we will wrap it up there.

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