Glossary — Agentic AI
What is an MCP Server?
1 min read Updated
A service exposing capabilities to AI agents via the Model Context Protocol — tools, resources, and prompts that any MCP-compatible agent can discover and use.
WHY IT MATTERS
MCP servers package functionality into standard interfaces. Like web servers serving content to browsers, MCP servers serve capabilities to agents.
Can expose: database queries, calendar integration, code execution, or financial operations like spending control and budget management.
Promotes composability — agents connect to multiple servers, combining capabilities into complex workflows.
HOW POLICYLAYER USES THIS
PolicyLayer runs as an MCP server, exposing policy evaluation, spending authorization, and budget management as standard MCP tools.
FREQUENTLY ASKED QUESTIONS
How do agents discover MCP servers?
Through server manifests that describe available tools, resources, and connection requirements. Agents can browse available capabilities before connecting.
Security?
MCP supports authentication and authorization. PolicyLayer as an MCP server requires agent credentials before exposing any spending control operations.
Can I build custom MCP servers?
Yes — MCP is open and well-documented. Custom servers can expose any functionality, including organization-specific financial tools that work alongside PolicyLayer.