PayPal said it is partnering with Microsoft to support the launch of Copilot Checkout, enabling shoppers to discover products, compare options, and complete payments directly within the Copilot experience. The integration will begin on Copilot.com and is expected to expand to additional Copilot-enabled devices and channels over time.
Under the arrangement, PayPal will power merchant inventory surfacing, branded checkout, guest checkout, and credit card payments. Merchant product catalogs will become purchasable through PayPal’s store sync capability, part of its recently introduced agentic commerce services designed to automate product discovery and transaction workflows across AI platforms.
The move reflects growing investment in AI-driven commerce, as technology companies seek to embed purchasing capabilities directly into conversational and productivity interfaces rather than routing users to external retail sites.
AI-Driven Shopping and Payments Integration
Microsoft’s Copilot applies contextual reasoning and intent recognition to surface curated shopping results. Users can browse and complete purchases without switching applications, with PayPal handling payment authorization and transaction flow. Microsoft said the integration is intended to reduce friction in the path from discovery to purchase while supporting merchant conversion.
For merchants, Copilot Checkout provides access to users who are already researching and comparing products inside Copilot. PayPal said the platform supports multiple funding options, including PayPal wallets and card payments, and applies buyer and seller protections on eligible transactions.
Ashley Global Retail is among the early retailers integrating the experience. The furniture retailer said AI-driven shopping assistants enable customers to explore designs and product configurations through conversational interfaces, supporting end-to-end purchasing within Copilot.
Microsoft cited internal data indicating higher conversion rates when shopping intent is present in Copilot sessions, although the companies did not disclose transaction volume expectations or revenue sharing terms.
Agentic Commerce and Platform Strategy
PayPal is positioning the integration as part of a broader push into agentic commerce, where AI systems coordinate product discovery, pricing, and checkout across multiple ecosystems. The company said its platform is designed to support open agent protocols and interoperability with leading AI platforms, allowing merchants to manage integrations through a single connection.
For Microsoft, embedding payments inside Copilot extends its push to make AI interfaces more transactional and commercially relevant across consumer and enterprise use cases. Copilot already spans productivity software, web services, and developer tools, and the addition of native checkout expands its role in commerce workflows.
The companies said Copilot Checkout will initially launch on the web, with plans to extend availability across additional form factors as Copilot expands its footprint. Merchant onboarding is being handled through PayPal’s platform, with store synchronization allowing inventory updates to flow automatically into Copilot.
