The UK government has published a policy agenda aimed at increasing the use of artificial intelligence in financial services, while seeking to keep regulatory and systemic risks in check.
The proposals draw on measures already introduced by regulators, including the Financial Conduct Authority’s AI Lab, which includes AI Live Testing and the Supercharged Sandbox.
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They also refer to the AI Input Zone, which has gathered examples of strong and weak practice ahead of an FCA paper due later this year.
The package is split into short-term actions, longer-term enablers and resilience measures.
A central theme is the need for clearer guidance for firms adopting AI tools and systems.
On regulation, the paper calls for closer coordination between authorities so firms can better understand what is expected of them.
One of the main proposals is for the FCA to examine the effects of financial guidance and advice-style responses produced by general purpose large language models.
That review would look at consumer outcomes, possible risks of harm, and competition concerns.
Its conclusions would feed into HM Treasury’s work on the regulatory boundary and whether added consumer protections, such as disclosures or public education, are required.
The paper urges firms to consider a shared, voluntary form of wording that would help consumers distinguish between regulated and unregulated AI-enabled financial guidance and advice-like services.
In the area of resilience, the government and regulators are asked to move more quickly on the Critical Third-Party regime, including scrutiny of significant AI and cloud providers.
Alongside that, the industry is encouraged to explore a voluntary assurance framework for third-party AI systems and models used by financial firms.
Commission are asked to encourage wider take-up of the Financial Services Skills Compact and examine the case for an AI skills plan covering senior leadership, technical specialists and frontline staff.
The paper also calls for practical changes to visa rules to make it easier for UK financial firms to recruit overseas AI specialists.
On payments, the proposals say an upcoming HM Treasury consultation should be used to create a framework for agentic payments. That framework would need to cover liability rules, identity checks for autonomous agents, and technical standards for authentication and governance.
The paper also raises broader questions around AI sovereignty and resilience, including closer work between industry and academia, clearer policy on domestic and overseas AI infrastructure, and a cross-sector taskforce to assess risks affecting finance and other critical industries.
Industry reaction
Claudio Bartolini, Head of Product Engineering, Soldo
AI Appreciation Day is a great moment to recognise AI’s progression beyond being a source of hype to a key tool that’s shaping how modern businesses operate. In financial services, for example, AI is increasingly being embedded into the day-to-day workflows teams rely on, helping to remove friction, deliver sharper real-time insights and free up more time for strategic work.
It’s also integral to how software is designed, developed and tested. That level of adoption doesn’t happen by accident. It requires discipline, strong governance and a culture that treats AI as a tool to amplify human intelligence, not replace it. The organisations that will thrive in this era are those that apply AI with both ambition and rigour, ensuring it is deployed in ways that are trusted, responsible and deliver meaningful outcomes.
Emma Erskine Fox, Partner, TLT
The AI Adoption Plan recognises one of the key challenges facing the financial services sector: how to provide firms with sufficient regulatory certainty to scale AI adoption without stifling innovation. Greater clarity is likely to be particularly valuable in areas such as agentic AI, where the application of existing regulatory principles is not always clear.
At the same time, the plan reflects growing concerns around the increasing criticality of AI providers within the financial system. As firms become more reliant on a small number of global AI providers to scale innovation, questions around operational resilience, concentration risk and data security are likely to become more acute.
This is especially relevant in the context of agentic AI, which is one of the areas where the current regulatory framework appears to be under the greatest strain. The industry approach to agentic payments could provide a blueprint for wider agentic AI use cases across financial services, making it critical that regulators and industry work together to develop frameworks that provide the certainty firms need while encouraging innovation.
Andrei Smirnov, Head of AI, ANNA Money
One of AI’s core promises was that it would reduce administrative burdens and unlock time for higher-value work, and it’s exciting to see this potential turn to reality.
Within fintech, this shift has been enabled not just by improvements to underlying models, but by engineers building tools that can be trusted to automate complex regulatory processes and deliver accurate financial insights, with little room for error. This is empowering people to take control of their finances in a way that previously required specialist knowledge and costly time investment, a gamechanger for entrepreneurs and small business owners.
Breakthroughs in contextual awareness, error correction, and multi-step reasoning chains have moved AI from theory to practice, enabling products that are making a meaningful difference to people’s lives and businesses. As innovation and adoption continue at pace, we expect this to further level the financial playing field and supercharge growth for entrepreneurs at all stages of their journey.
Theo Wasserberg, Head of UK and Ireland, Embat
The UK needs a Prime Minister who understands that economic growth is an imperative in the new AI world. We cannot afford to fall behind. Maintaining a predictable business environment will be a key part of this.
The next PM should also prioritise access to international AI talent. We are competing on a global stage, and it is no time to be parochial. Streamlining the visa regime would make an immediate difference.
On AI regulation, we need an even-handed approach that keeps the UK competitive. We have world-class research and AI hubs like King’s Cross; we just need leadership with the conviction to back them.
We work with treasury teams across the country that are heavily exposed to the rates environment. If the markets lose confidence in a new administration’s direction, it will create real headaches for corporate treasurers managing liquidity, hedging and debt costs. Any lurch that unsettles investors won’t just affect start-up funding; it ripples into every finance department in the country.
