Payments giant Block is entering “growth mode” as it launches AI tools to help teams internally and aid business clients with data-driven insights. 

Block launched its AI-driven agent, Goose, in the second quarter, Chief Executive Jack Dorsey said during its earnings call Aug. 7.

Goose “is being used by nearly everyone in the company, it’s accelerating our developers, it’s accelerating our designers,” Dorsey said. “It’s allowing us to experiment at near-zero cost so that we can actually get to the right answer much faster, and we can get the customer feedback much faster, too.”  

The San Francisco-based company is deploying AI for internal and external uses to drive efficiency and deepen consumer engagement, he said.  

Block’s client-facing, AI-driven use cases include: 

• Cashbot, an AI-powered customer-support agent; 

• Square AI, which provides businesses with data-driven insights; and 

• Pools, its AI-driven marketing agent. 

“Product innovation and go-to-market investments are accelerating across Block” with AI, Dorsey said. For example, using AI, “we took Cash App Pools from development to pilot in just a few months.”  

THE BIG PICTURE: The company is seeing increasing traction with its buy now, pay later (BNPL) activities after embedding Afterpay in its peer-to-peer payments platform Cash App, Dorsey said. 

“We’re seeing some of the newer products in Cash App, like post-purchase BNPL on the Cash App card, which is the first real integration of Afterpay into Cash App,” he said. “Post-purchase BNPL as of July crossed the 1 million active user milestone.” 

Cash App had gross profit of $1.5 billion in Q2, up 15.5% year over year, according to Block’s earnings report. 

While BNPL transactions are growing, the company is keeping a close eye on its lending standards to maintain a healthy credit profile, Dorsey said. 

“The core asset that we’re leveraging to power post-purchase on BNPL on the Cash App card is Cash App’s internal credit score,” he said. “It’s our internal custom credit scoring mechanism, incorporating data across our customers in how they’re using Cash App to inform an underwriting decision and eligibility for our customers.” 

The scoring mechanism is updated continuously and “absorbs data across Cash App’s ecosystem to assess basically where we can underwrite our customers, whether we can and then at what credit limit we can,” Dorsey said. 

While the company did not disclose the volume on its BNPL offering, it reported that 96% of all payments were made on time and close to 1% of all payments were at risk of default, according to the company’s earnings. 

“Our credit model, our internal credit model can approve 38% more customers compared to VantageScore at the same loss threshold,” Dorsey said. 

BY THE NUMBERS: In Q2, Block reported: 

• Gross payment volume of $64.2 billion, up 10% YoY; 

• Gross profit of $2.54 billion, up 13.9% YoY; and 

• CashApp card monthly users of 57 million, flat YoY. 

MARKET REACTION: Shares of Block (NYSE: XZY) were down 3.93% from market open to $73.0 as of 2:50 PM EST. Block has a market capitalization of $47 billion.