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Visa and Mastercard in an AI World: Separating Fear from Reality

By Charlie Tian, GuruFocus
Feb. 25, 2026

The rise of artificial intelligence has sparked headlines suggesting that the world’s largest payment networks — Visa Inc. and Mastercard Incorporated — could face existential threats. Reports like Citrini Research’s “agentic commerce” scenario envision a future where autonomous AI agents choose the cheapest payment rails, potentially bypassing card networks entirely. But how realistic is this scenario? And what does it mean for investors today?

The Core Business Model Remains Strong

Visa and Mastercard operate capital-light, network-based businesses:

They do not take credit risk; banks issue the cards.
They do not own inventory or physical infrastructure.
They earn fees on billions of transactions, benefiting from network effects, global merchant acceptance, and trust.

AI can enhance their operations, but it does not replicate decades of regulatory approvals, global settlement infrastructure, and brand credibility.

AI as a Tailwind, Not a Threat

AI already strengthens payment networks in several ways:

Fraud Detection & Risk Management
- AI improves real-time transaction monitoring, behavioral scoring, and anomaly detection.
- The same technology can be used by fraudsters, but Visa and Mastercard’s data advantage is massive.
Operational Efficiency
- AI can optimize compliance, routing analytics, and dispute resolution, lowering per-transaction costs.
Volume Growth Support
- AI accelerates e-commerce, embedded finance, and cross-border digital commerce — all of which run over Visa and Mastercard rails.

In short, AI amplifies their competitive advantage rather than threatens it outright.

Real Risks AI Introduces

Despite their strengths, AI does introduce long-term uncertainties:

Disintermediation Risk
- Autonomous agents could optimize for low-cost rails, potentially diverting some transaction volume.
- Likelihood in the next 3–5 years is low; adoption requires mass consumer and merchant behavior change, plus regulatory approval.
Merchant Fee Pressure
- AI gives merchants detailed cost analytics and bargaining power, possibly compressing interchange margins over time.
Fraud Escalation
- AI-driven attacks could scale faster. Defense is AI-enhanced, but costs may rise.
Regulatory Evolution
- AI innovation could prompt regulators to accelerate open banking and alternative payment frameworks, potentially capping fees.
Value Capture Shifts
- If AI intermediates more of the commerce stack, Visa and Mastercard may remain the rails but see smaller shares of economic surplus.

Reading Citrini Research Realistically

Citrini’s report paints a dramatic picture: card networks “gutted” by AI-driven autonomous payments. The reality is more moderate:

The scenario is hypothetical, not a forecast.
Most hurdles — mass stablecoin adoption, global regulatory alignment, and widespread AI-controlled payments — are unlikely to happen quickly.
Gradual margin pressure is plausible; catastrophic revenue loss is not a base case.

Market reactions reflect sensitivity to AI narratives, but fundamentals remain intact.

Bottom Line for Investors

Visa and Mastercard are structurally resilient and capital-light, with high free cash flow.
AI is more likely to enhance their operations and security than replace their networks.
Long-term investors should monitor merchant behavior, regulatory developments, and AI-driven payment alternatives, but the base-case outlook remains strong.

The key takeaway: AI may reshape margins gradually, but it is unlikely to unseat the world’s most entrenched payment networks anytime soon. Fear-driven market swings may overstate short-term risk, creating potential opportunities for disciplined investors.

About: Charlie Tian, Ph.D. is the founder and Chief Executive Officer and portfolio manager of GuruFocus Investments, LLC, an SEC-registered investment management firm.