The payments industry moves trillions in value each year from $2 quadrillion in value flows, yet most transactions still lack real‑time, identity‑anchored assurance. Embedding verified digital identity into payments delivers stronger security, smoother customer experiences, and modernization across traditional, fintech, and crypto rails. By combining verifiable credentials, PKI, and biometrics, banks can streamline authentication, processors can reduce fraud with continuous identity signals, and emerging crypto architectures can enable compliance without sacrificing user freedom. As AI‑driven agentic commerce grows, identity‑bound authorization becomes essential for safe, auditable transactions. We will also discuss industry consortia and standards efforts that are now advancing these capabilities at scale.