A UK parliamentary committee warned regulators this month. It said AI use in financial services outpaces oversight and risks consumers and the financial system.
The committee named Financial Conduct Authority, Bank of England, and HM Treasury as relying too heavily on existing rules and urged clearer direction. See the committee’s findings for details.
It called for the Financial Conduct Authority to publish guidance by the end of 2026 on consumer protection and on how senior accountability rules apply when AI causes harm. The committee warned regulators’ current approach leaves gaps in responsibility and enforcement.
The report said “By taking a wait-and-see approach to AI in financial services, the three authorities are exposing consumers and the financial system to potentially serious harm,” and urged faster action.
Dermot McGrath, co-founder of ZenGen Labs, highlighted past fintech successes. He added “To its credit, the UK got out ahead on fintech—the FCA’s sandbox in 2015 was the first of its kind, and 57 countries have copied it since. London remains a powerhouse in fintech despite Brexit,”
Many firms already use AI in core operations, yet lack a clear understanding of those systems. This opacity complicates accountability and risks deterring careful adopters (Ed. note: regulatory uncertainty could slow responsible AI deployment).
