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The Government has just opened a Call for Evidence on the hot topic of AI in financial services. With AI already in deployment across the financial services industry this Call for Evidence is intended to explore the tricky balancing act question of opportunity versus threat in specific context. The areas under the microscope include:
- how AI is currently being used in financial services and how this might change over the next decade;
- how the adoption of AI in financial services looks relative to adoption by other economic sectors;
- the key barriers to the adoption of AI by the financial services industry;
- the areas of impact where AI could be adopted by financial services with low risk;
- how well placed the UK is, relative to other countries, to take advantage of what AI has to offer to the financial services industry;
- what the risks are and how to mitigate them; and
- what the benefits might be.
The advantages of AI to financial services could be many, from increased back-office efficiencies and the better deployment of human skill sets, to improved fraud detection. The risks are also many, from hallucinations to third-party dependencies, to data protection risks. How the Government and the regulators decide how to strike the right balance will be an interesting and evolving discussion. The Call for Evidence closes on 17 March 2025.
If you would like to discuss how current or future regulations impact what you do with AI, please contact me or Martin Cook, Tom Whittaker, Brian Wong, Lucy Pegler, or any other member of our Technology Team.
AI is being deployed across various sectors within financial services, including retail banking, investment banking, insurance, and pensions. The purpose of this inquiry on “AI in financial services” is to explore how the UK financial services can take advantage of the opportunities in AI while mitigating any threats to financial stability and safeguarding financial consumers, particularly vulnerable consumers.
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