Nearly half of the UK’s leading retailers are investing in agentic AI to enhance payment experiences, according to TLT’s latest Retail Agility Report. The research, based on a survey of the top 100 UK retailers across grocery, fashion, beauty, home, and leisure sectors, reveals a sector racing toward autonomous commerce – but struggling to keep pace with governance and regulatory readiness.
Agentic AI, which enables systems to make purchases, compare prices, and negotiate on behalf of consumers, is gaining traction fast. 49% of retailers are investing in agentic AI, with 29% combining this with loyalty-linked payments and 20% focusing solely on AI-driven solutions. Early use cases include autonomous replenishment, dynamic pricing decisions, and AI-led selection of optimal payment methods.
However, readiness remains low. Just 15% of retailers say their payment contracts and infrastructure are prepared for AI-mediated transactions, while nearly half admit liability for AI-enabled payments is unclear – a critical gap as autonomous agents begin making routine buying decisions.
Payment innovation accelerates
Beyond AI, retailers are doubling down on payment innovation to sharpen customer experience and drive loyalty. The report found that digital wallets top the priority list for 50% of retailers, Buy Now Pay Later (BNPL) remains strong, with 45% prioritising it – particularly in fashion and beauty – and open banking adoption is patchy, with just 15% of retailers fully integrated. Crypto and blockchain payments remain niche, with only 10% prioritising them.
Regulatory uncertainty
Governance is emerging as a major challenge. 70% of retailers cite regulatory uncertainty as a key concern, and 45% are unclear on AI liability. Risk areas flagged by the report include:
- Data sharing compliance: Only 23% fully compliant.
- AI-era consumer protections: Just 11% have updated frameworks.
- Customer safeguards: 48% have comprehensive protections; 8% operate with minimal safeguards.
These gaps point to what TLT calls an “innovation gap” – where technological adoption outpaces the structures needed to deploy it safely.
Perran Jervis, partner and head of retail at TLT, highlighted this innovation gap as a significant challenge for retailers as AI “fundamentally change(s) how retailers approach discoverability, pricing, loyalty, data access and competitive advantage.” He said: “With innovation comes a degree of uncertainty around regulation, prevalent among 70% of retailers, and there is a risk of an ‘innovation gap’ as technological adoption advances faster than the governance structures needed to deploy it safely and effectively. Retailers that close this gap – by combining innovation with robust governance and customer trust – will lead the next phase of payments maturity and unlock meaningful strategic advantage.”
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