What PayPal gets from AI-powered browsing

• Key Insight: PayPal is adding AI-powered search via Perplexity's Comet Browser
• What's at stake: PayPal has developed a suite of AI-powered payment products in recent years.

• Forward look:  Visa, Mastercard and other payment companies are also investing heavily in new forms of AI

PayPal has leaned heavily on artificial intelligence under CEO Alex Chriss, a strategy it is accelerating by adding AI-powered web browsing. 

Venmo and PayPal customers in the U.S. and limited global markets can get early access to  Perplexity's AI-powered Comet Browser before it becomes widely available. Comet will give PayPal's customers a generative-AI tool to manage subscriptions, shopping, payments and other parts of their lives, coming at the same time that Visa, Mastercard, Stripe  and other payment companies push agentic and generative AI to sell value-added services beyond payment processing. 

"PayPal wants to be at the forefront of agentic payments," Tony DeSanctis, senior director at Cornerstone Advisors, told American Banker, noting that PayPal was early to support Internet payments and is looking to replicate that success with AI.

What is Comet?

Comet, which launched in July, integrates generative AI in browsing. Users can seek personal information such as emails and calendars, generate summaries of web pages and automate personal tasks via conversational demands rather than traditional web navigation.

Perplexity AI, a three-year-old San Francisco-based company, developed Comet. The technology uses large language models and web search to generate responses to user queries based on real-time internet content. Perplexity supports conversational queries and responses, enabling follow-up questions, and is an alternative to AI developers such as OpenAI, the company behind ChatGPT.

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PayPal has added a one-year free subscription to Perpexity Pro, the company's $200 premium service, to PayPal's subscriptions hub, a product that centralizes customer subscriptions to simplify management, perform changes using conversational language, and the ability to execute payments. 

PayPal users will see three smartphone screens through the Perplexity deployment: the PayPal app with an account balance; a Perpexity Pro promotion; and subscription management and featured offers. U.S. customers that link three or more subscriptions via PayPal's hub will get a $50 cashback incentive.

"PayPal's partnership with Perplexity is part of its continued effort to connect customers to emerging technologies and digital tools. Earlier this summer, PayPal and Perplexity announced a partnership to power agentic commerce across its Perplexity Pro platform," a PayPal spokesperson said in an email.

PayPal's AI moves

PayPal is enhancing its AI tools to improve value-added services such as subscription management and shopping as the company seeks to manage a slowdown in branded checkout growth, partly due to impact from tariffs. U.S. branded checkout growth was less than 2% in the second quarter, according to analysts at Jeffries. 

"That level of growth brings structural questions back to the fore, which is rarely constructive," Jeffries analysts said in a research note. 

During PayPal's most recent earnings call, Chriss highlighted PayPal's work on artificial intelligence as a way to make payment processing easier, adding PayPal is focusing on "what it can control" amid political and economic uncertainty.

PayPal's AI investments over the past two years include Fastlane, which shortens the checkout experience and acts as a payment facilitator by routing transactions to the cheapest and fastest option. Another product, Advanced Offers, uses payments data fed to PayPal's AI engine to inform merchants' incentive marketing to specific consumers. Venmo merchants can also access PayPal's AI to personalize incentive marketing.

Additional products include PayPal Everywhere, a feature that enables consumers to choose a monthly category of spending, such as groceries or clothing, and receive 5% cash back on up to $1,000 when using a PayPal debit Mastercard. These offers can also be stacked by saving offers in the PayPal app from brands such as Sephora, Domino's, DoorDash, Instacart and others.

Comet adds an AI browser to the mix.

"An AI-powered browser could be quite disruptive in certain fintech markets, such as credit cards and loans, by making it much easier to find the best deal," Aaron McPherson, principal at AFM Consulting, told American Banker. "There are websites for this now, but a browser like Comet disintermediates them by compiling the same data independently, or retrieving the data directly from the site."There could be a reaction to this, to force the AI firms to pay for this data, similar to the lawsuits by publishers like the New York Times against OpenAI and Anthropic, McPherson said.

PayPal is also competing in an AI arms race against other payments companies. Mastercard recently launched Agent Pay, an agentic payments program that is part of an emerging AI bundle at Mastercard such as Agentic Tokens, a security protocol that leans on Mastercard's established tokenization capabilities to secure mobile contactless payments, secure card-on-file, Mastercard Payment Passkeys and recurring transactions such as subscriptions. Visa unveiled a similar product that allows AI agents to make purchases on users' behalf.

"The whole concept of an AI-based browser is probably a bit premature, but PayPal is making the right move to be part of the drive to adoption," DeSanctis said. "If they can get people onto Anthropic's browser and PayPal is the embedded credential, that is a first-mover advantage."