Building the future of finance in the age of AI

This post was originally published on fca.org.uk 

The Mills Review

That is why we commissioned the Mills Review, published in July, focused on how AI could reshape retail financial services by 2030.

Some developments we anticipated are already emerging, including the transition towards agentic finance, such as the launch of Meta’s Muse.

Our response to the review is not to consult, study and report progress. Our focus is testing, assurance, monitoring and surveillance: directly with industry to understand how AI systems are being deployed.

Whilst the Review focused on retail, the AI shift does not stop at the retail boundary. Across wholesale markets too, AI is accelerating how firms analyse, trade, monitor and make decisions.

We are embedding 6 of the 7 recommendations into live work immediately. Our innovation services such as the AI Lab give us direct insight into what firms are building from agent-led payments and fraud detection to consumer support.

On frontier AI security, we are working directly with banks to understand how frontier models are changing cyber defence, identifying and linking vulnerabilities and assisting with triaging, patching and recovering at greater speed. Those insights are feeding directly into our supervisory and policy response.

Firms are not bystanders in that process. The leaders will be those that deploy AI effectively, innovatively and safely.

But increasingly, AI is also changing what happens before a consumer ever reaches a regulated firm. Consumers are turning to general-purpose large language models (LLMs), like ChatGPT, Gemini and Claude, for financial information and advice, while regulated firms are beginning to integrate their services into AI platforms.

The good news – this can significantly widen access to financial tools and information. But it can also blur the boundary between regulated and unregulated activity, and the protections consumers receive.

Four in five less-experienced investors aged 18-40 have used AI to help with investing, but only 40% of consumers correctly recognise that there is no recourse if something goes wrong after acting on advice from a general-purpose AI tool. Our answer is not simply to expand our remit, but to make the existing boundary clearer.

Through InvestSmart and the FCA Firm Checker, we already help consumers understand the protections they have. But warnings may be more effective at the point where AI-generated financial information is delivered.

So we are calling on AI providers to help consumers understand the limits of financial information and advice generated by their models through clear, proportionate and consistent disclaimers.

And rather than create a new public-interest financial capability tool, as the Mills Review suggested, we will build on existing work, including IOSCO’s first TechSprint, powered by our AI Lab to help investors spot scams, verify information and challenge unreliable AI outputs.