PayPal has announced a strategic integration with Microsoft Copilot, positioning itself at the center of a growing shift toward AI-powered commerce experiences. The collaboration enables shoppers to discover products, make purchase decisions, and complete payments directly within Copilot, without leaving the AI interface.
The integration supports the launch of Copilot Checkout, starting on Copilot.com, where PayPal will power merchant inventory discovery, branded checkout, guest checkout, and credit card payments. The move reflects a broader industry trend toward embedding commerce directly into AI assistants, reducing friction between product discovery and transaction completion.
At the core of the partnership is PayPal’s agentic commerce infrastructure, which allows merchants’ product catalogues to be synchronised and surfaced in AI-driven environments. Through PayPal’s store sync capability, participating merchants can make their inventory instantly purchasable within Copilot, extending their reach to users already researching, comparing, and evaluating products.
Microsoft’s Copilot goes beyond traditional search by incorporating user intent, context, and conversational prompts into the shopping journey. Rather than navigating multiple websites, users can now browse curated, shoppable recommendations and complete purchases through PayPal’s payment rails within a single interface.
For merchants, the integration offers a new channel to engage high-intent customers at the decision-making stage. By shortening the path from discovery to checkout, Copilot Checkout is designed to improve conversion rates while reducing drop-offs caused by redirects and complex payment flows. According to Microsoft, shopping journeys that include Copilot interactions generate significantly higher purchase activity compared to those without AI assistance.
The collaboration also brings PayPal’s buyer and seller protections into the Copilot ecosystem, offering consumers multiple funding options, including PayPal wallets, alongside safeguards on eligible transactions. This layer of trust is expected to play a key role in encouraging adoption, particularly as AI-driven shopping experiences continue to evolve.
Beyond immediate checkout functionality, the partnership signals PayPal’s intent to remain relevant as commerce increasingly shifts toward conversational and agent-based platforms. By supporting open agentic protocols and multiple AI ecosystems through a single integration, PayPal is positioning itself as a foundational payments layer for the next generation of digital commerce.
As AI assistants move from productivity tools to transactional platforms, integrations like this highlight how payments, discovery, and decision-making are converging. For both Microsoft and PayPal, the collaboration represents a strategic bet on a future where commerce happens wherever users are thinking, searching, and conversing—not just where they traditionally shop.
