diff --git a/account-kit/infra/src/actions/types.ts b/account-kit/infra/src/actions/types.ts
index 4a52dbb229..a1c50e6b7c 100644
--- a/account-kit/infra/src/actions/types.ts
+++ b/account-kit/infra/src/actions/types.ts
@@ -57,6 +57,11 @@ export type RequestGasAndPaymasterAndDataRequest = [
   {
     policyId: string | string[];
     entryPoint: Address;
+    erc20Context?: {
+      tokenAddress: Address;
+      permit?: Hex;
+      maxTokenAmount?: BigInt;
+    };
     dummySignature: Hex;
     userOperation: UserOperationRequest;
     overrides?: UserOperationOverrides;
diff --git a/account-kit/infra/src/client/smartAccountClient.ts b/account-kit/infra/src/client/smartAccountClient.ts
index 6c6791550a..b5f634fc8a 100644
--- a/account-kit/infra/src/client/smartAccountClient.ts
+++ b/account-kit/infra/src/client/smartAccountClient.ts
@@ -12,7 +12,7 @@ import {
   type SmartContractAccountWithSigner,
   type UserOperationContext,
 } from "@aa-sdk/core";
-import { type Chain } from "viem";
+import { type Address, type Chain } from "viem";
 import {
   alchemy,
   convertHeadersToObject,
@@ -48,6 +48,13 @@ export type AlchemySmartAccountClientConfig<
   account?: account;
   useSimulation?: boolean;
   policyId?: string | string[];
+  policyToken?: {
+    address: Address;
+    approvalMode?: "NONE" | "PERMIT";
+    maxTokenAmount?: bigint;
+    erc20Name?: string;
+    version?: string;
+  };
 } & Pick<
   SmartAccountClientConfig<AlchemyTransport, chain, account, context>,
   | "customMiddleware"
@@ -163,6 +170,7 @@ export function createAlchemySmartAccountClient(
     ...(config.policyId
       ? alchemyGasAndPaymasterAndDataMiddleware({
           policyId: config.policyId,
+          policyToken: config.policyToken,
           transport: config.transport,
           gasEstimatorOverride: config.gasEstimator,
           feeEstimatorOverride: config.feeEstimator,
diff --git a/account-kit/infra/src/gas-manager.ts b/account-kit/infra/src/gas-manager.ts
index 9041f15612..e4173c900b 100644
--- a/account-kit/infra/src/gas-manager.ts
+++ b/account-kit/infra/src/gas-manager.ts
@@ -1,4 +1,4 @@
-import type { Address, Chain } from "viem";
+import type { Address, Chain, Hex } from "viem";
 import {
   arbitrum,
   arbitrumSepolia,
@@ -66,3 +66,38 @@ export const getAlchemyPaymasterAddress = (chain: Chain): Address => {
       throw new Error(`Unsupported chain: ${chain}`);
   }
 };
+
+export const PermitTypes = {
+  EIP712Domain: [
+    { name: "name", type: "string" },
+    { name: "version", type: "string" },
+    { name: "chainId", type: "uint256" },
+    { name: "verifyingContract", type: "address" },
+  ],
+  Permit: [
+    { name: "owner", type: "address" },
+    { name: "spender", type: "address" },
+    { name: "value", type: "uint256" },
+    { name: "nonce", type: "uint256" },
+    { name: "deadline", type: "uint256" },
+  ],
+} as const;
+
+export const EIP712NoncesAbi = [
+  "function nonces(address owner) external view returns (uint)",
+] as const;
+
+export type PermitMessage = {
+  owner: Hex;
+  spender: Hex;
+  value: bigint;
+  nonce: bigint;
+  deadline: bigint;
+};
+
+export type PermitDomain = {
+  name: string;
+  version: string;
+  chainId: bigint;
+  verifyingContract: Hex;
+};
diff --git a/account-kit/infra/src/middleware/gasManager.ts b/account-kit/infra/src/middleware/gasManager.ts
index 362088c336..b992178a0d 100644
--- a/account-kit/infra/src/middleware/gasManager.ts
+++ b/account-kit/infra/src/middleware/gasManager.ts
@@ -1,4 +1,5 @@
 import type {
+  Address,
   ClientMiddlewareConfig,
   ClientMiddlewareFn,
   EntryPointVersion,
@@ -20,10 +21,23 @@ import {
   noopMiddleware,
   resolveProperties,
 } from "@aa-sdk/core";
-import { fromHex, isHex, type Hex } from "viem";
+import {
+  fromHex,
+  isHex,
+  toHex,
+  type Hex,
+  encodeAbiParameters,
+  encodeFunctionData,
+  parseAbi,
+  maxUint256,
+  sliceHex,
+} from "viem";
 import type { AlchemySmartAccountClient } from "../client/smartAccountClient.js";
 import type { AlchemyTransport } from "../alchemyTransport.js";
 import { alchemyFeeEstimator } from "./feeEstimator.js";
+import type { RequestGasAndPaymasterAndDataRequest } from "../actions/types.js";
+import { PermitTypes, EIP712NoncesAbi } from "../gas-manager.js";
+import type { PermitMessage, PermitDomain } from "../gas-manager.js";
 
 /**
  * Paymaster middleware factory that uses Alchemy's Gas Manager for sponsoring
@@ -54,11 +68,20 @@ export function alchemyGasManagerMiddleware(
 
 interface AlchemyGasAndPaymasterAndDataMiddlewareParams {
   policyId: string | string[];
+  policyToken?: PolicyToken;
   transport: AlchemyTransport;
   gasEstimatorOverride?: ClientMiddlewareFn;
   feeEstimatorOverride?: ClientMiddlewareFn;
 }
 
+export type PolicyToken = {
+  address: Address;
+  maxTokenAmount?: bigint;
+  approvalMode?: "NONE" | "PERMIT";
+  erc20Name?: string;
+  version?: string;
+};
+
 /**
  * Paymaster middleware factory that uses Alchemy's Gas Manager for sponsoring
  * transactions. Uses Alchemy's custom `alchemy_requestGasAndPaymasterAndData`
@@ -86,7 +109,7 @@ interface AlchemyGasAndPaymasterAndDataMiddlewareParams {
  * @param {AlchemyGasAndPaymasterAndDataMiddlewareParams.transport} params.transport fallback transport to use for fee estimation when not using the paymaster
  * @param {AlchemyGasAndPaymasterAndDataMiddlewareParams.gasEstimatorOverride} params.gasEstimatorOverride custom gas estimator middleware
  * @param {AlchemyGasAndPaymasterAndDataMiddlewareParams.feeEstimatorOverride} params.feeEstimatorOverride custom fee estimator middleware
- * @returns {Pick<ClientMiddlewareConfig, "dummyPaymasterAndData" | "paymasterAndData">} partial client middleware configuration containing `dummyPaymasterAndData` and `paymasterAndData`
+ * @returns {Pick<ClientMiddlewareConfig, "dummyPaymasterAndData" | "feeEstimator" | "gasEstimator" | "paymasterAndData">} partial client middleware configuration containing `dummyPaymasterAndData`, `feeEstimator`, `gasEstimator`, and `paymasterAndData`
  */
 export function alchemyGasAndPaymasterAndDataMiddleware(
   params: AlchemyGasAndPaymasterAndDataMiddlewareParams
@@ -94,8 +117,13 @@ export function alchemyGasAndPaymasterAndDataMiddleware(
   ClientMiddlewareConfig,
   "dummyPaymasterAndData" | "feeEstimator" | "gasEstimator" | "paymasterAndData"
 > {
-  const { policyId, transport, gasEstimatorOverride, feeEstimatorOverride } =
-    params;
+  const {
+    policyId,
+    policyToken,
+    transport,
+    gasEstimatorOverride,
+    feeEstimatorOverride,
+  } = params;
   return {
     dummyPaymasterAndData: async (uo, args) => {
       if (
@@ -188,6 +216,82 @@ export function alchemyGasAndPaymasterAndDataMiddleware(
           : {}),
       });
 
+      let erc20Context: RequestGasAndPaymasterAndDataRequest[0]["erc20Context"] =
+        undefined;
+      if (policyToken !== undefined) {
+        const maxAmountToken = policyToken.maxTokenAmount || maxUint256;
+
+        erc20Context = {
+          tokenAddress: policyToken.address,
+          ...(policyToken.maxTokenAmount
+            ? { maxTokenAmount: policyToken.maxTokenAmount }
+            : {}),
+        };
+        if (policyToken.approvalMode === "PERMIT") {
+          // get a paymaster address
+          let paymasterAddress: Address | undefined = undefined;
+          const paymasterData = await (
+            client as AlchemySmartAccountClient
+          ).request({
+            method: "pm_getPaymasterStubData",
+            params: [
+              userOp,
+              account.getEntryPoint().address,
+              toHex(client.chain.id),
+              {
+                policyId: Array.isArray(policyId) ? policyId[0] : policyId,
+              },
+            ],
+          });
+
+          paymasterAddress = paymasterData.paymaster
+            ? paymasterData.paymaster
+            : paymasterData.paymasterAndData
+            ? sliceHex(paymasterData.paymasterAndData, 0, 20)
+            : undefined;
+
+          if (paymasterAddress === undefined || paymasterAddress === "0x") {
+            throw new Error("no paymaster contract address available");
+          }
+          const deadline = maxUint256;
+          const { data } = await client.call({
+            to: policyToken.address,
+            data: encodeFunctionData({
+              abi: parseAbi(EIP712NoncesAbi),
+              functionName: "nonces",
+              args: [account.address],
+            }),
+          });
+          if (!data) {
+            throw new Error("No nonces returned from erc20 contract call");
+          }
+
+          const typedPermitData = {
+            types: PermitTypes,
+            primaryType: "Permit" as const,
+            domain: {
+              name: policyToken.erc20Name ?? "",
+              version: policyToken.version ?? "",
+              chainId: BigInt(client.chain.id),
+              verifyingContract: policyToken.address,
+            } satisfies PermitDomain,
+            message: {
+              owner: account.address,
+              spender: paymasterAddress,
+              value: maxAmountToken,
+              nonce: BigInt(data),
+              deadline,
+            } satisfies PermitMessage,
+          } as const;
+
+          const signedPermit = await account.signTypedData(typedPermitData);
+          erc20Context.permit = encodeAbiParameters(
+            [{ type: "uint256" }, { type: "uint256" }, { type: "bytes" }],
+            [maxAmountToken, deadline, signedPermit]
+          );
+        }
+      }
+
       const result = await (client as AlchemySmartAccountClient).request({
         method: "alchemy_requestGasAndPaymasterAndData",
         params: [
@@ -197,6 +301,11 @@ export function alchemyGasAndPaymasterAndDataMiddleware(
             userOperation: userOp,
             dummySignature: await account.getDummySignature(),
             overrides,
+            ...(erc20Context
+              ? {
+                  erc20Context,
+                }
+              : {}),
           },
         ],
       });