Digital Payments

OpenAI has publicly acknowledged that AI hallucinations—where models generate plausible but false information—are not just engineering oversights but mathematically inevitable. This marks a significant shift in how the AI community understands the limitations of large language models.

What the Research Reveals In a study led by OpenAI researchers Adam Tauman Kalai, Edwin Zhang, Ofir Nachum, and Georgia Tech’s Santosh Vempala, the team demonstrated that:

Even with perfect training data, language models will still hallucinate due to fundamental statistical and computational constraints.

The process of generating text one word at a time based on probabilities leads to compounding errors, especially in longer responses.

The error rate for full sentence generation is at least twice that of simple classification tasks like yes/no questions.

“Like students facing hard exam questions, large language models sometimes guess when uncertain, producing plausible yet incorrect statements instead of admitting uncertainty,” the researchers wrote

Apple Pay vs Google Pay Security

Apple Pay Security-

1. . Credit Card Info – You first add your card details into Apple Wallet.
2. Pass Credit Card Info – The info is securely sent to the bank for verification.
3. Store to Chip. – Apple Pay doesn’t store your real card number. Instead, it creates a Device Account Number (DAN) stored in the phone’s secure chip.
4. DAN Used in Transactions – When you pay, Apple Pay sends this DAN instead of your actual card number.
5. Bank Validates – The bank processes the DAN and approves the transaction.

Important Point: Apple never stores your card number on its servers. The sensitive data stays only on your device in the secure chip.

Google Pay Security

1. Credit Card Info – You add your card into Google Pay.
2. Store Info to Google Server – Unlike Apple, Google Pay sends card info to its cloud servers.
3. Payment Token Generated – Google creates a Payment Token that represents your card.
4. Token Sent to Merchant – When you pay, this token is sent to the ecommerce server (merchant).
5. Token Passed to Bank – The token is validated against the real card info stored in Google’s servers.
6. Bank Approves – The bank checks the actual card info and approves the transaction.

Important Point: Google Pay relies on cloud tokenization, meaning your card info is stored on Google’s servers in the encrypted format.

Apple Pay vs Google Pay Main Difference

1. Apple Pay: Card info never leaves your device → stays safe inside a secure chip.
2. Google Pay: Card info goes to Google’s servers → secure but involves a third party storing your card data.

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Solutions

• 2025-09-16 Google announced the Agent Payments Protocol (AP2), a new, open standard designed to solve the fundamental question of trust in AI-driven payments in commerce. Today’s payment systems assume a human is clicking "buy." AP2 creates the framework for a world where autonomous AI agents can securely and verifiably transact on behalf of users and businesses.