How Stripe Uses AI to Make Global Payments Feel Local

0:02 Georgie Healy: Founders scale faster on Deel.

0:04 Karl Durrance: Set up payroll for any country in minutes, hire anyone anywhere, get visas handled fast, and get back to building. Visit deel.com/dayone.

0:15 Georgie Healy: That's D-E-E-L dot com slash day one. AI and payments innovations will help Aussie businesses broaden their global customer reach.

0:29 Speaker C: The internet economy presents this opportunity to sell to the world, and especially I think what excites me the most is sell to the world from Australia. One of the reasons we use AI is to optimise the customer experience for a buyer in another market so that an Australian business can present the checkout to a consumer in Singapore, but make sure that they're providing a really localised buying experience. So the Singaporean consumer, it looks like they're buying from essentially any other business that's in Singapore, but actually they're buying from an Australian business.

0:59 Georgie Healy: What is agent e-commerce specifically?

1:02 Speaker C: Issuing single-use cards, for instance, also addresses the fact that maybe you're not sharing your personal payment card information to an agent and then potentially that proliferating. It's a single-use card with a limit based on what you are in essence assigning to the agent. And then once that purchase is done, the card is deissued.

1:21 Georgie Healy: Do you think AI will make the payments industry better or worse in terms of scams versus opportunities? Hello and welcome to In the Blink of AI, your front row seat to the AI revolution. I'm Georgie Healy, and this week we have Karl Jurantz. He's the managing director of Australia and New Zealand at Stripe, and we dig behind the headlines today. Having a fintech wizard in the hot seat means deeper insights on everything about payment fraud and scams, uh, agentik Commerce and his hot take on BNPL that I've never heard before. And Stripe is both a user of AI— they run massive AI systems for fraud detection at a global scale— but they also power payments for thousands of AI startups. We had a chat around what's the next big unlock in global payments in the next 5 years. And after this conversation, if you're like, I need more. I need to know more. Stripe had their tour this week in Sydney. And if you're listening to this show on Thursday, you should be able to go online by the end of the week, by Friday at stripe.com and see all of those sessions online. Let's dive in.

2:41 Speaker C: You're listening to a dayone.fm show.

2:44 Georgie Healy: Hi, Karl. Thank you for joining In the Blink of AI. It's a true pleasure to have you. I know how busy your week is and next week will be. We'll get into that. But first, maybe tell the listeners who you are and what you're working on at the moment.

2:59 Speaker C: Yeah, no, thanks for having me. So I lead the business for Stripe across Australia and New Zealand. We're a financial infrastructure platform and we help businesses of all sizes to be able to manage the movement of money inside their organisation, right? So that could be as simple as accepting payment online or in person, or as complex as helping them with their core billing systems, tax, revenue reconciliation. We have a very scaled business. So last year we processed just on $1.4 trillion on behalf of customers across the globe, which is equivalent of about 1.3% of global GDP.

3:36 Georgie Healy: Wow.

3:37 Speaker C: So enormous data sets, enormous economic impacts. And so, you know, from an AI perspective, which I know we're here to talk about today, very, very large data sets that we can train our models on in order to deliver value to our customers.

3:49 Georgie Healy: You've been in tech for 25 years or so, is that right?

3:53 Speaker C: Yeah, I've been—

3:53 Georgie Healy: well, thanks for calling that out. Yeah, yeah, no, I've been in it for 15 years and it feels like a long 15 years, so I can imagine. Does it feel different to you this time in AI? You know, you've seen a lot of, I'm sure, swings and roundabouts in technology. How does it feel for you at the moment this time?

4:10 Speaker C: It's feeling, I think, uncomfortably fast. I think, When I look at the other waves that I've been part of, like I did a decade at AWS and was part of the beginning of the cloud wave and saw that all the way through to, you know, the point that it became the way versus the challenger. And then prior to that, you know, I was part of mobile as well. I mean, we all went through mobile as consumers, but saw that go through enterprise as well. I think the difference with AI is definitely the speed this time round. And there's a couple of ways of measuring this. I think like if I take a step back and look at what we're seeing just at scale, Stripe versus just my specific opinion. You know, when we look at the AI companies that are being born right now, we've never seen businesses reach revenue milestones faster than today. So, you know, for instance, we're seeing on average the AI companies that are born on Stripe, and we've got like 73% of the Forbes AI 50. So we've got a really good, you know, I guess, optics of what the AI sector looks like. Mm-hmm. The average for reaching a $5 million ARR position is 9 months. And that's excluding the edge cases. So we've just never seen businesses grow this fast before. But like when I look back then at the other waves that I've been part of, and you classically look at like the Gartner hype cycle and— Yes. The fact that you have this peak of inflated expectations, the trough of disillusionment, and then you get into like that, I think it's called the plateau of productivity. But like everything goes through these waves. And normally when you have these big waves, mindshare moments and everyone's talking about the, the future change and the impacts and what is this going to mean for businesses and consumers, you tend to be in that inflated expectations kind of curve, but the revenue's not there yet. It's the promise of impact. What's happening this time is the revenue's there at the same time as the beginning of the hype cycle. And so we've just never seen anything like this before. It's, it's moving at a pace that is just unprecedented.

6:15 Georgie Healy: Wow. You've articulated beautifully what VCs are kind of telling me, which is their metric for what they would invest in is just such a higher ARR than it used to be. Like it used to be maybe 1 ARR, like 1 million ARR. Now it's 5, maybe it's now 10. Just the barometer to make them interested has just become so much higher.

6:38 Speaker C: Yeah, and just like normally, I think historically when we think about startups, there was an investment, amount of investment capital, and then there was a burn rate in order to reach revenue as you found product market fit. But they're finding product market fit and revenue in year in millions. Like again, we've just, we've never seen anything like this before. And it's not just centered in Silicon Valley, it's global, right? We're seeing great AI companies be born here in Australia as well, which is super exciting. Yeah.

7:11 Georgie Healy: I can't wait to dive into that a little bit more. But we've got this recurring segment on the show. It's very popular called AI Hack of the Week.

7:19 Speaker C: All right.

7:20 Georgie Healy: So our listeners, you know, can try a hack that we've already vetted and like doing. Would you like to kick us off?

7:28 Speaker C: Yeah, yeah. And like, not hack in the traditional sense. I'm not cutting Python code here, but—

7:34 Georgie Healy: You know, next time we get you on the show, that can be a Python-specific hack.

7:36 Speaker C: Okay, good. I'll dust off the skills.

7:38 Georgie Healy: Yeah.

7:39 Speaker C: But like for me, Just generally, I'm using AI, in particular large language models, which I think everyone's using, as a little bit of just a peer and a buddy to either give me ideas, summarize text for work, and things like that. Like, it's— I'm finding it quite helpful just to make me more productive. But like, something I did in the last week is, you know, like you called out, you know, we're pretty busy at Stripe at the moment. We've got big events coming up, and, and so I'm really excited about planning my next holiday in the school holidays in October. Relatable. Yeah, totally. I'm like, I'm like, okay, I'm already getting ready for my break.

8:15 Karl Durrance: Me too.

8:16 Speaker C: And so, we're just going to do a quick road trip to Port Stephens. And so, I used ChatGPT to see, well, what are the activities that I could do with kids? And then I did some follow-up prompts because I've got a pretty big age gap between my kids. I've got teenagers and toddlers. And it came up with something that I never would have thought of, which is crabbing. Now, I haven't booked anything yet, but I'm like, well, that's interesting. Like, I would never have found that organically in a search engine. But what's happened is it's given me this prompt to suggest, hey, maybe try this. And I think it's a really cool kind of use of AI in giving you new ideas that maybe you would never have come across or thought of outside of these tools being available.

9:00 Georgie Healy: Yeah, hard to search for something you don't know exists, right?

9:03 Karl Durrance: Exactly, exactly.

9:04 Georgie Healy: Have you told the kids about the crabbing yet?

9:06 Speaker C: No, I haven't.

9:07 Karl Durrance: I haven't.

9:07 Georgie Healy: Oh, okay. We'll keep that a surprise, eh? Yeah.

9:12 Karl Durrance: As a startup founder, you are juggling multiple priorities from the expected, like finding product-market fit, to the unexpected, like customer requests for SOC 2 or ISO 27001 certification. Achieving compliance is time-consuming, and time spent on that is time away from the needs of the business. And that's where Vanta comes in. Vanta is the all-in-one solution for startups to become compliant quickly. And build a security foundation with ease. With a combination of automation, an extensive partner network, and a security marketplace containing 385+ pre-built integrations, Vanta provides the necessary tools and expertise for startups to achieve compliance seamlessly, no matter how urgent your needs are, and at every phase of growth. Over 10,000 leading companies, including Cypherstash, Handle, and Indetted, trust center to automate compliance so they can focus on growing the needs of their business. Here is the important part. Startup listeners of the show get $1,000 off if they go to dayone.fm/blink.

10:31 Georgie Healy: Okay, so my hack is very similar, related to kids as well. I've got— my eldest is about to turn 6, and so, you know, we're from Brisbane originally, and one of the most amazing things about living in Sydney is this access to the ocean. And so, he is due for nippers next year. Oh. We're very excited to try nippers. But look, I'm gonna call them out. Coogee Nippers did not send the easiest sign-up process I've ever seen. 4 different PDFs, each, you know, 10 pages long or more. And I felt like I was in a Kafka novel because it was like, you can't do this without doing that. And that's buried in some other document, but you should have already signed up here. And you can't pay for it without, doing something different. It was an absolute nightmare. And no matter how many times my husband and I read all the documents, we're like, I still don't know what you want from us.

11:26 Karl Durrance: Yeah.

11:27 Georgie Healy: Uploaded all the documents into Gemini, and just the prompt, tell us what we need to do. Please just tell us what you want.

11:36 Speaker C: Yeah, yeah.

11:36 Georgie Healy: And it gave 7 steps in order. This is in this document, do that first. This is in that. I think I had a follow-up question, which is, what bank account does it say? And it's like, here's the bank account details. Saved me hours. I've reshared it with Kuching Nippers, like, here's the steps you could give other people next time.

11:58 Speaker C: Yeah, yeah, this is the way to make it. And I mean, you can see future Agentik workflows being able to just manage those processes for people instead. I've got the same thing, like I'm trying to register my oldest son's AusTag team. And it's not that, straightforward actually. And so, I was able to, you know, like sign up on the portal and create the account and create the team. And the feedback that his friends are giving is that the other parents are having trouble joining the team. And then there's these PDFs that aren't that straightforward. And like, you're right. Like, there does— there needs to be this way of simplifying these just everyday processes, especially around kids and sport.

12:37 Georgie Healy: I fear that people will just not sign up if it's that convoluted, right?

12:43 Speaker C: Yeah, yeah.

12:44 Georgie Healy: We nearly didn't, like, and then I was like, wait, put this into some of the AI tools and see. So we are ready for the next section. I'm very excited about this. I have stalked you online a little bit.

12:57 Karl Durrance: Oh, okay.

12:57 Georgie Healy: Little bit, quite famous. And one of the things you mentioned is that AI and payments innovations will help Aussie businesses broaden their global customer reach. Where are we at currently and where do you see that going?

13:14 Speaker C: Yeah, I mean, I think, you know, when we look at AI global reach, a lot of it's linked to the digital economy, right? So commerce on the internet. And the great thing about the digital economy is it makes the world small, right?

13:28 Karl Durrance: Yes.

13:28 Speaker C: So traditional retailers may have a physical store and they can only engage with and sell to consumers that come and visit them. And generally that's going to be either in one or any number of locations, but they can get access to the markets for which they're physically present. I think the, the internet economy presents this opportunity to sell to the world, and especially I think what excites me the most is sell to the world from Australia, not necessarily having entrepreneurs move to other markets to get access to those markets, right?

13:58 Karl Durrance: Mm-hmm.

13:58 Speaker C: One of the interesting things that we see at Stripe is is that whole cross-border side of the platform. And so right now, about 1 in 4 customers that are on Stripe in this part of the world are selling to another part of the world, and so doing cross-border commerce. If we go over across the ditch to New Zealand, it's 1 in 2.

14:17 Georgie Healy: Wow.

14:18 Speaker C: And a lot of that's linked primarily to the fact that the domestic opportunity here, it's just smaller than, say, North America, right? And so a business might be born in North America and don't have to think global from day one because the market's huge, right? They could, they could be born and continue to grow there for many, many years. Here, if a business has got ambition to grow, they kind of need to look across to other markets. If we compare the, you know, the 1 in 4 businesses on Stripe in Australia that are going global versus what we see in the wider economy, only 2% of Australian businesses are selling internationally, right? And so there's a really big shift and opportunity, I think, for businesses in Australia to go online and then to go and take parts of the addressable market in other countries. Now, from an AI perspective though, the question is, well, how do I engage with a consumer in another part of the world? And it, it gets really complicated really quickly. So for instance, if you've got an Australian website and maybe you're selling some sort of Australian good or service, and you want to then break into Southeast Asia, you can't expect a consumer in Singapore to pay for the good the same as an Australian consumer does. They don't like using credit cards as much as we do. They may want to use with a digital wallet like GrabPay or some other payment method that makes a lot more sense for them. And so what we do, one of the reasons we use AI is to optimize the customer experience for a buyer in another market so that an Australian business can present the checkout to a consumer in Singapore, but make sure that they're providing a really localized buying experience. So the Singaporean consumer, it looks like they're buying from essentially any other business that's in Singapore, but actually they're buying from an Australian business. And so going through those optimization strategies depending on the device they're using, mobile or browser, the location they're in, maybe what else we know about that market or that consumer. And then I guess preferencing the ways to pay for them at the checkout optimizes the conversion opportunity for business.

16:36 Georgie Healy: Can't believe you've brought this up because yesterday I was speaking to AI founders that are in the seed Series A stage. And VCs are often saying, okay, founders, which of you is moving to SF? And whoever draws the short straw, off they go. What would you say to those founders that would help them in those conversations where they're like, I don't actually think I physically need to be in SF to do this?

17:05 Speaker C: I think it's interesting 'cause I think the classic reason to move to SF would be access to talent, right? But I think these days in particular with, AI copilots and, um, and, and assistants in particular for developing software, we're finding that actually you can be very productive in other parts of the world. And so, I mean, I get really excited about businesses like, like Canva, for instance, that are still going global from Australia, and we're very, very proud to be associated with them and to help them go global. But it is possible, and I think productivity tools like AI make it even more possible to be able to go global from your home market.

17:47 Georgie Healy: I love this and I am seeing this emerging conversation happen. I would love to use your incredible domain expertise in agentic commerce, a word we've never said on the show before.

18:01 Speaker C: I can't believe we've never talked about agentic commerce.

18:03 Georgie Healy: Agents, yes, agentic commerce, I would love, anyone listening to be able to drop this in a sentence next week. Yeah. What is agentic commerce specifically?

18:12 Speaker C: I mean, it's very aligned to the conversations you've been having about agents, right? Like agentic commerce just refers to an agent completing part or all of the buying experience autonomously, right? So that could be as simple as an agent doing research on behalf of a consumer to shortlist a set of purchases, but then maybe you take action on the end of that research, or it could be as complex that the agent goes through the entire checkout flow, completes the transaction, fills in the last-mile fulfillment information so that the product can be posted. And so it covers the whole flow. I mean, we're pretty bullish about agentic commerce over at Stripe, primarily because it aligns with our core mission. Our core mission is to increase the GDP of the internet. And we fully believe that in the fullness of time, there's going to be a good portion of transactions that happen on the internet that are done by agents, not just by humans.

19:09 Georgie Healy: I mean, if it could order my groceries for me, I would be—

19:12 Speaker C: But why couldn't it? Like, and I think that's what we're seeing. We're seeing these new emerging use cases pop up. You know, one of the ones I could call out is Perplexity. It's in the US at the moment, right? But they've got a couple of use cases that are pretty interesting. They've got a shopping assistant where it will, based on your prompt, and maybe your prompt might be, I want a new set of dark-colored jeans in this size at this budget range. It will go and search external websites, collate responses. Now it can shortlist for you, but in some cases will complete the checkout and fulfillment information to be able to post you the item. Right now, this is kind of where we're going. They've also got a travel assistant as well, where it will do itinerary design. It will search flights, won't book flights yet, but you can see that, that— Yeah. Is probably where it's going to go. But it's about making some of these, these experiences lower friction, right? So like, I think we can definitely see this is where it's going. We're also seeing embedded agentic commerce as well. So the likes of Amazon with their Buy for Me use case where, um, where primarily it's going to search their catalog and present you options, but also it does support searching external to Amazon as well. So we're seeing some of these businesses be born where they're almost entirely independent and they're saying that we'll search all of the sites for you. And then you can see some are being born inside existing ecosystems in order to surface more of their own catalogs. But one way or the other, um, we're pretty confident that a good chunk of commerce is going to happen through agents.

20:56 Georgie Healy: I can't wait for the flight use case.

21:00 Speaker C: I know.

21:00 Georgie Healy: Have you, maybe it's a me problem, the number of times I've accidentally booked the wrong day, the wrong year.

21:09 Karl Durrance: Yeah, yeah.

21:09 Georgie Healy: I'm like, you know.

21:10 Speaker C: Did you rock up at the airport though, or did you—

21:12 Georgie Healy: Yeah, I genuinely have. My husband will confirm that he's had to save me a few times where I'm like, whoops, wrong day. Shocking, because it seems like such a boring brain switch-off task to book flights, but it's, catastrophic if you get it wrong, right?

21:28 Karl Durrance: Yeah, yeah, totally.

21:29 Georgie Healy: How do you see that working? Like, say this is through Perplexity. I guess they've got your billing information in order to be a Perplexity Pro user. Is that how you see it working from a security and payments perspective? They use that saved billing information?

21:45 Speaker C: Well, a lot of the time, actually, what we're doing for them is issuing kind of one-time use cards to the agent. With a certain spend limit, right? Because one of the things that we know about large language models and agents is, you know, there are challenges with hallucination.

22:01 Georgie Healy: Yeah.

22:01 Speaker C: And so what you don't want is suddenly an agent that for whatever reason, based on the prompt or what have you, starts hallucinating and making purchases on your behalf that maybe was not your intention. But issuing single-use cards, for instance, also addresses the fact that maybe you're not sharing your personal payment card information to an agent and then potentially that proliferating. It's a single-use card with a limit based on what you're, in essence, assigning to the agent. And then once that purchase is done, the card is deissued, right? And so that's kind of how we're looking at doing it at the moment. I think that moving forward, we're definitely going to see an evolution there and probably more embedding into other payment method types. But that's at the moment how Perplexity are managing it with us.

22:48 Georgie Healy: That's genius, Karl. Can you take credit for that? No, I cannot take credit. I really love it. I would happily do that without that fear of, oh my gosh, is it going to drain my entire bank account?

23:00 Speaker C: And I think that's what it is. I mean, a lot of this is going to be less about technology and more about the comfort of delegating these certain, you know, transaction decisions to an agent. And I think as people get more and more comfortable with it and get I guess, experience in using these things, then we're going to start seeing, well, what are the things that people are comfortable delegating to an agent and what are the things that aren't? And I think the jury's out on that. Like, I've had conversations with people who've said, oh, everything, that means agents are going to do all the buying for people. And I'm like, I don't subscribe to that at all. I think that the shopping experience is something that brings joy to many people's lives.

23:39 Georgie Healy: Guilty. Yeah.

23:39 Speaker C: Yeah, me too, right? But there are certain, maybe certain types of gifts or certain types of transactions that are more administrative than they are joyful. And so, maybe those things will be delegated and maybe, maybe actually there'll be a chance to do more of those things through agents so that I can spend more time either doing joyful shopping or doing other things and just using that time for family or for work or for anything else.

24:04 Georgie Healy: Well, the kids' birthday party scenario.

24:07 Karl Durrance: Hmm.

24:08 Georgie Healy: I don't get that much joy out of looking for 3-year-old birthday gifts.

24:11 Karl Durrance: Yeah.

24:11 Georgie Healy: So, that would be a great one.

24:13 Speaker C: Yeah. I mean, you could imagine— I was just thinking about this the other day of saying, Imagine there was an agent that could manage like some of those or like extended family birthdays and say, "Oh, it's my nephew's 11th birthday." Having it remind me, come up and say, "Actually, right now, based on what's happening in the market, these are the 3 most popular toys for 11-year-old boys. And would you like me to make that purchase for you? And I'll make sure that it's wrapped because I know it's a gift and I'll make sure it gets there on time." and you go, well, that's wonderful. I don't wanna be stressing out about those transactions. But maybe if I'm wanting to buy, you know, a more intimate kind of gift for a loved one, well, I'm probably gonna wanna be more involved in that decision. More personal.

24:56 Karl Durrance: Exactly. Yes.

24:57 Georgie Healy: Wow. Okay, I can't wait. I'm bullish on agentic commerce as well now. But you know, it's my job to play devil's advocate. Yeah. I was one of the 4 million Swifty fans in Australia that wanted tickets. I was very lucky, I got tickets to the Melbourne show. But I don't know if we'd call it bots or agented commerce or the like, were accused of driving up ticket prices and scalping tickets and then fans missed out due to that. I'm not sure if that was Australia specifically or the other shows. How could that be avoided or how much do you attribute that to being a potential issue with agented commerce? Yeah.

25:36 Speaker C: I think where there is upside, there's always gonna be an actor that uses it for their benefit, which is probably downside for everybody else, right? I mean, ticket scalping is a tough one, right? I mean, it's state-based laws, depending on the state you're in has a different rule.

25:54 Georgie Healy: I didn't know that.

25:55 Speaker C: Yeah, so like New South Wales is illegal. I think you are allowed a very modest markup. It's like 10% or something like that. Okay. But it is meant to stop it as a revenue generation vehicle, which is people hoovering up tickets and then reselling them for profit. I mean, our approach is firstly to partner with organizations that do this legally, and there's the likes of TIXL and these kind of platforms that are really good at that, where they will manage the laws, allow you to publish tickets, and at least as someone who maybe is buying a ticket secondhand, at least you know you're buying it from a reputable source and it's going to be a ticket that's going to work on the day because there's a lot of fake tickets that get sold as well. But I think it's just, it's going to be that constant arms race, to be honest, where people are going to use bots or other vehicles in order to drive their outcomes, which might be to drive, you know, semi-illegal or sometimes illegal activity like scalping. And then there's going to be the opposing view, which is the likes of Stripe stepping in with fraud tools in order to stop these kind of actors before they can start. And it's, I mean, it's just one of those things that we're always fighting each other, I think.

27:08 Georgie Healy: Yes, I'm so glad you brought it up. Anyone I've spoken to and told that I'm about to speak to you, Karl, guess what they all wanna know about?

27:18 Speaker C: What do they wanna know about?

27:19 Karl Durrance: Fraud.

27:20 Georgie Healy: Fraud, yes. And scams.

27:21 Speaker C: Definitely, it's the number one thing.

27:23 Georgie Healy: That's always in the headlines. That's all we hear about. When we briefly spoke in the past, you really beautifully articulated the difference, which I wasn't aware of. Of before. Can you share the difference between fraud versus scams and maybe which is more meaningful here and now?

27:40 Speaker C: Yeah, I mean, I think, you know, broadly they're in the same banner, right? Like, I think we might call them all a type of fraud, but I think the attack vector is very, very different. I think traditionally when we think of fraud or the way that we think of fraud now at Stripe is far more technical, right? Which is, stolen credit cards or attack vectors around card testing, and then using technology in order to address those attack vectors. And generally speaking, fraud year on year, whilst the overall value of fraud in those attack vectors is going up, it's going up in line with the proportion of sales as well. So the proportion of fraud, generally speaking, is not going up. It's just, it's a cost of doing business, unfortunately. And generally speaking, the risk mitigations protections that players can provide are doing a good job of fighting against fraud. Stripe's got a really strong point of view in this, and I think one of the things that we've got a strength on is just the sheer amount of data that we have access to. And then we can train our models against data because scale kind of matters in these fights against fraud. 92% of the world's credit cards have been seen on the Stripe network, and so we can kind of— Yeah. Attack fraud and address card testing before it even hits the merchant. So that's like one side. I think the other side is scams, and actually scams is an order of magnitude higher in the impact to the Australian economy than fraud is.

29:14 Georgie Healy: Wow.

29:14 Speaker C: And the challenge with scams, it's more of a social engineering vector of attack, right? Which is any amount of technology that you put in place in order to protect against fraud, in many cases will not protect you against a scam because a scam, because it's an attack on a person and convincing a person to conduct a transaction which is probably not in their best interest, they will pass through every test because they believe they're doing the right thing. And so that's the challenge with scams is technology alone is not going to solve this.

29:50 Georgie Healy: Yeah, so you're saying, you know, we can put passwords and multi-factor authentication and blah, blah, blah, but if the person doesn't know that it's a scam, they will just provide those details and keep unlocking things.

30:05 Speaker C: Yeah, they're convinced to hand over a transaction amount to a scammer because they believe they're doing the right thing. It's really interesting, like the technical approaches now for addressing scams scams, it sounds counterintuitive for what technology generally does to society because normally what happens is technology comes in and it may automate, improve, reduce friction, provide a customer experience that is superior to the past. And so by nature of that, because the experience is, is great, it drives adoption, right? Mm-hmm. And so they, they do really, really well and they can sell more technology. For scams, what's happening is technology is actually increasing friction in the transaction. I don't know about you, but like, for instance, a week ago, I had to— I did a small nominal donation, it was about $30 to a soccer coach for my son's soccer team, and it was to do a thank you gift, right? Now, when— because I'd never paid that person before, I put that into my banking app, I put the BSB and account number in. I said it's $30. I hit go. It did a, it did a biller lookup to say, firstly, this account number and the name match.

31:19 Georgie Healy: Yes.

31:19 Speaker C: And so that's one thing you can look at to go, okay, this looks okay. But then it said, now warning, because you've never made a payment to this payee before, the funds may be held for up to 48 hours. And so it's not because the money can't move fast enough. Actually, the money can move almost instantly on the rails. Actually, the friction is there to make sure that a scammer or a person being scammed can take action. Potentially they have a post-transaction remorse, or maybe they tell someone that they're associated with, a family friend or loved one or whatever, and they say, "Actually, I think that was risky," and they've got time to call the bank to stop the payment. And so—

32:01 Georgie Healy: Yeah.

32:02 Speaker C: It's just really interesting. Normally we would associate technology with making things faster and lower friction, but actually to address scams, many of the solutions are about slowing things down.

32:14 Georgie Healy: Wow, that's fascinating. I never actually put two and two together. I thought it was like a human error related thing, but it could be, yeah.

32:20 Speaker C: Definitely addressing maybe some of that, like that fingering on the, on the BSB and account number. And I think the Biller Lookup helps you on that. Yeah, everyone's done it, right? Like, and they're not necessarily, you know, no one really remembers a whole bunch of numbers very easily, but actually slowing the transactions down is primarily a mitigation against scams.

32:39 Georgie Healy: The elephant in the room is, is it generational as well? A little bit of this, you know, things to me that may be obvious, like, well, that's obviously a scammer. Don't, don't send them your money. Might not be obvious to generations older than us. Is there any data behind that or is it just getting harder for everyone to identify scams? Or what are your thoughts or observations?

33:05 Speaker C: Yeah, well, I think broadly you're right. I think there is a degree of generational gap here. And I think generally those younger generations that are maybe more technology adapted are going to use different channels and that maybe aren't as great vectors for scammers versus maybe using the phone and call centers and that maybe the older generations tend to prefer. They prefer those because that's what they grew up with. But I think as, as GenAI continues to expand its use cases and bad actors get hold of those as well, I think it's becoming harder and harder to identify what a scam is as well, right? Because they're becoming very effective and very lifelike. And so actually, I think it is a problem cross-generational, actually.

33:55 Georgie Healy: Yeah.

33:56 Speaker C: Versus us just pigeonholing it only into the older generation. I think they are probably the more susceptible, but actually I think it's something we need to solve for everyone.

34:04 Georgie Healy: Look, the last thing on this topic, AI is obviously making so much of the world better and easier and democratizing information, and there's brilliant things around it, but there's also these negatives we've talked about. Do you think AI will make the payments industry better or worse in terms of scams versus opportunities?

34:28 Speaker C: I think it will make it better. I think that it provides a really interesting new growth vector for business, and I think it provides the opportunity to reduce friction for consumers. And when you put those two things together, I think it's good for everyone.

34:45 Karl Durrance: Yeah.

34:46 Speaker C: There's always going to be bad actors out there that try to leverage that for their purposes. And they're not going away. But what I trust in is I think that generally speaking, there is an incredible opportunity ahead of us. I think the one thing that when I look at the opportunity and what concerns me is whether or not businesses are leaning into this fast enough as a growth vector versus maybe resisting. Like classically, when we think about, for instance, bots, which you could say an agentic commerce or an agent conducting a purchase on behalf of a consumer is a bot. Normally when we think of bots on the internet, we, we tend to think that they're bad, right? And they're scraping and, and they're doing some sort of activity that maybe you don't want them to do on your website. But very quickly what's going to happen is there's a portion of bots that actually going to be conducting purchases on behalf of consumers that are exactly what businesses will want, right? And if we fast forward even a very small amount of time in the future, there is going to be a portion of transaction volume that are going to be conducted by bots and then some by humans. And so I think actually from an opportunity perspective, my biggest concern is that Australian businesses don't capture that amount of growth opportunity or that market share fast enough. That's my biggest concern versus maybe the, the bad actors in the market and what they're doing. I think there's a great growth opportunity.

36:16 Georgie Healy: Bots really need a rebrand. Like, I hear bots, I think, yeah, malicious intent kind of thing.

36:22 Speaker C: Yeah, totally, totally.

36:23 Georgie Healy: So the tech's ready, it's just maybe a hearts and minds thing that needs to change, do you think, from—

36:29 Speaker C: I think there's still a little bit more to go with the tech as well, 'cause traditional bot protection is very effective, and no one is saying that what we should suddenly do is just open the front door and let all bots in. I think that's not a great idea, it's not a good strategy. What we need to do is work out, well, how do we start, you know, identifying, well, what are the good agent bots and maybe what are the ones that aren't? Do I have some sort of trust or authentication process for bots? You know, we have KYC processes at the moment, so know your customer. Do we need to implement KYA, know your agent type processes as well?

37:06 Georgie Healy: Ooh, yeah.

37:06 Speaker C: In order to say, you know what, for these type of agents, I'm very comfortable with them transacting on my website because they're a known quantity and I know that they're going through appropriate risk controls for onboarding. But maybe these other ones I'm not that confident with. And we do the same now with human buyers.

37:22 Georgie Healy: Yeah. Right?

37:23 Speaker C: And so we need to— I think there still needs to be a little bit of work on the technical side in order to be able to give merchants the comfort to know that they can make those decisions. But it's moving so quickly.

37:36 Georgie Healy: We're at my favorite part of the interview, the spicy questions.

37:40 Speaker C: Spicy?

37:40 Georgie Healy: Yeah. How do you handle heat?

37:43 Speaker C: I don't know, let's see how spicy they are.

37:46 Georgie Healy: I think you'll handle them beautifully. The first one, always in the headlines, usually bad branding.

37:52 Speaker C: Okay.

37:53 Georgie Healy: Buy Now Pay Later, BNPL. You know, it's accused of allowing customers that don't have the means to buy things that they can't afford and have loans that they can't repay. What's your take on BNPL, Karl?

38:06 Speaker C: I think BNPL is good, broadly, is the top-line summary. I think it's good for merchants because it allows consumers maybe to pay in another way and get access to that growth. I think it's great for consumers because it provides them a credit option that is alternative to other credit sources like credit cards. And I think it's great for the economy because when you put those two things together, there's more money moving in the economy and that's good for everyone. Like the whole notion that BNPLs are evil, like I don't, I kind of don't subscribe to that. I've even heard people on panels say that and so my general response to that is, well, but are you comfortable with credit card debt at 17% to 22%? And why is that any better than providing the ability for someone to pay in for. And I think another thing is there's probably a generational misunderstanding here. Like for me, in my generation, I manage most of my finance on a credit card. It's not because I need credit per se, it's just that that's how I choose to manage my finances, right? I buy my groceries, I pay for everything on a credit card and then I have my process to pay that off and that's how I like I like to manage my finances. There are many people, in particular some of the younger demographic, that like to manage their finances with a BNPL. It doesn't mean they need to pay for their groceries in 4. It just means that's how they like to manage their finances. It's no different really than using a credit card. What's really interesting as well is well over 90% of the funding sources attached to a BNPL is a debit card. This is not credit on credit. This is just debit and BNPL is a new form of credit that some of the younger generation are just very, very comfortable in using. So I think it's great. And I think anything that allows consumers to get access to credit is a good thing as long as it's used responsibly. And quite frankly, I think they are pretty responsible credit engines. They are now regulated as a consumer credit product, which I think was one of the things— Mm-hmm. That was called out in the past saying, "Well, it's an unregulated credit product." That's definitely not the case now. It is a regulated credit product. And when you take a step back and see, well, if someone uses a BNPL and maybe they fail to make one of those payments, actually the default position of a BNPL is not to allow you to use that again until you pay off your previous debt. And so it actually is a fairly responsible tool. I think, again, some of the naysayers would say that there was BNPL stacking going on and so people were signing up to all of them. Again, no different to people holding more than one credit card.

40:55 Georgie Healy: That's what I was thinking, yeah.

40:56 Speaker C: So again, I think that we need to take a lot of the emotion out of it and actually see it for what it is, which is it's just an alternative credit product. And I think it's a great thing for the economy.

41:06 Georgie Healy: I think one of the founders of Afterpay wrote an amazing book that's highly recommended in the tech space as well. So maybe I'll have a read because, yeah, I think the distinction between why we're so mad at BNPL and not at credit card debt needs to be explored a little bit, perhaps. Apparently 32% of adult Australians have a form of cryptocurrency, which is a significant rise in recent years. So clearly the popularity of crypto and Bitcoin when I was starting a startup in 2019, it hasn't gone to that disillusionment and stayed there. What are your thoughts on crypto, Karl?

41:46 Speaker C: Firstly, that surprises me, 1 in 3. People, honestly. I'm a fan of crypto, actually. And let me explain kind of where that comes from. About 10 years ago, I bought a very small amount of Bitcoin. I no longer hold it. I bought a very—

42:02 Georgie Healy: That's the social media clip right there.

42:04 Speaker C: Yeah, I'm not retiring. I bought a very— well, I mean, and you can buy very small amounts of Bitcoin because it's essentially infinitely divisible. You don't need to buy one. You can buy, point X of one. And so that's what I did. And, um, and I deliberately bought it to firstly work out what is this thing, and then I immediately transacted with it because I wanted to understand, well, how does it work? Um, and I learned a lot about how long it takes for it to settle on the blockchain. Um, it's, it's, it's quite anxiety driving actually, because you don't know whether or not really it's worked. And then the volatility of it meant when you paid for something, the next day what you paid may be very, very different to what it was yesterday, right? Mm-hmm. Because as we know with commercial Bitcoin, the value of it is extremely volatile, right? So I have had a bit of experience over the years. I think what I'm more interested about these days and why I'm, I guess, more excited is the concept of stablecoin. And stablecoin has all the advantages of digital currency, but addresses a lot of the core disadvantages, in particular about things like volatility, speed of transaction, and cost of transaction. And so we're making some pretty big bets at Stripe around the fact that digital currency, we think, is, is likely the future of what internet money movement will look like. But it will all be around stablecoin. And so stablecoin is pegged to generally a fiat currency like the US dollar. Mm-hmm. And so when you use one stablecoin at 1 USD, if it's worth 1 US dollar yesterday, it's worth 1 US dollar tomorrow. And so it means merchants can trust it because they're getting paid in an amount that they can trust and consumers can trust it as well because they can do the same.

43:55 Georgie Healy: It's based on the live currency.

43:59 Karl Durrance: Yes.

43:59 Georgie Healy: Yeah. Oh, that's fascinating. Yeah, yeah, yeah.

44:01 Speaker C: It's pegged to the value of the currency. And essentially what we're doing here is creating internet money.

44:09 Karl Durrance: Yep.

44:09 Speaker C: Right? And so, you know, general fiat currency is fine. It's hyper-domestic, but it's still built on banking systems, banking rails that predate the internet, right? And so now what we have is the ability to provide a digital currency that is more internet native, but also give value, give it a value that's not volatile.

44:36 Georgie Healy: Who do you think is the perfect person for stablecoin? 'Cause I kind of think of the crypto space and the Dogecoins and blah, blah, blah as people that love the volatility and love the drama.

44:47 Speaker C: Yeah, yeah.

44:47 Georgie Healy: And then there's like the old Italian woman inside me that wants to put all her money under a mattress on the other end. Who wants stablecoin, do you think, as an early adopter? Who can you see?

44:57 Speaker C: Yeah, I mean, I think your earlier one, like people that are buying Bitcoin, Doge, and meme coins, I think, think they're not buying that to use it as a currency to pay for goods and services. They're buying as a stored asset class and they're hoping for growth, right? Um, like buying— maybe buying digital gold is probably the equivalent, right? It's— they're going to hold that as an asset. Stablecoin is going to be for those people that want to transact on the internet. Um, and so those people that maybe are very internet native maybe looking to transact with merchants in other parts of the world, maybe merchants that they haven't had access to before for whatever reason. Maybe stablecoin opens up new markets for them. I think that could be the interesting use cases. And then in the fullness of time, I think we're going to see potentially a convergence of agents leveraging stablecoin because when you think about it, because stablecoin can move at the speed of data on the internet, and because it's inherently internet native and digital and based on a blockchain and it's global from day one, and you pair that with an agent acting on your behalf and it's a bot, when you put those two things together, I think it's gonna drive a huge acceleration in internet commerce.

46:13 Georgie Healy: Carl, to finish the show, if you had to predict when that could happen, got you on record.

46:20 Karl Durrance: Yeah.

46:20 Georgie Healy: When are we thinking we've got agentic commerce, leveraging stablecoins?

46:26 Speaker C: Anyone who makes predictions gets them wrong. But I can see these two things converging really quickly because the one thing, like we talked about at the very beginning of the show, was these things are moving at speeds that are unprecedented, right? And so what was normally taking almost decades is happening in years. And so I can see these things coming together in the next 5 years or so.

46:53 Georgie Healy: Oh, you're a good sport and very brave. Before I let you go, I would love you to tell us what might be happening next week, Thursday, 11th of September.

47:04 Karl Durrance: Yeah.

47:04 Georgie Healy: What's happening then?

47:06 Speaker C: So we're bringing together a set of customers, partners, and then showcasing global thought leaders, local thought leaders, businesses in exploring what the future of internet commerce looks like.

47:21 Georgie Healy: Wow.

47:22 Speaker C: We'll be going through a bunch of product announcements, new launches for businesses in this part of the world, and basically going through what are the growth opportunities, where are the growth opportunities for business, and how in particular Australian and New Zealand businesses can get their fair share of what the global opportunity looks like in the internet economy.

47:43 Georgie Healy: Will you be there?

47:44 Speaker C: I will be there.

47:45 Georgie Healy: How do we watch it? How do we see it if this episode goes live on the day and people have missed it in person? Yep. Can they get it online?

47:52 Speaker C: They can, they can, yes. So we'll be recording the content and publishing that online as well at stripe.com. And so, yes, if this goes live prior, you can even show up on the day and register. If not, it'll all be available online.

48:05 Georgie Healy: I'm gonna be there. Thank you so much for coming on the show, Karl. This has been an absolute treat.

48:10 Speaker C: Thanks, Georgie. Cheers.

48:14 Georgie Healy: Thank you for listening to In the Blink of an Eye. AI. You can check out the show notes for anything discussed in this week's episode, and we will be back next week. This podcast was produced by Day One with music by Dan Hansen and visual artwork by Sophie Tyrell. If you loved the episode, please tell your mates, and I love AI news. Please share your thoughts and suggestions to georginarosehealy@gmail.com.