Legal comment: FCA review into impact of AI on retail financial services
The FCA has published The Mills Review, setting out how AI could reshape retail financial services for consumers, firms, markets and regulators by 2030 and beyond.
Commenting on the review, Helen Simm, financial services lawyer, said:
"The FCA’s review, the first of its kind, sets out a comprehensive assessment of how AI (in particular agentic AI) will reshape retail financial services by 2030.
The finding that 11 million UK adults are likely to use autonomous AI for personal finance decisions underlines the urgency for firms to act now. In practical terms, that means reviewing AI governance frameworks, stress-testing Consumer Duty obligations against AI-driven customer journeys and ensuring that any deployment of agentic AI tools is subject to meaningful human oversight. Firms that are still treating AI governance as a future compliance exercise risk being caught off guard; both by the pace of consumer adoption and by the FCA's increasing supervisory focus in this area.
The FCA's continued reliance on the Consumer Duty and Senior Managers Regime as the framework for AI oversight is a sensible, proportionate approach; but firms should not mistake flexibility for low expectations. The FCA’s forthcoming AI good and poor practice publication will be essential reading.
Firms that engage now and build robust AI governance frameworks will find themselves in the best position when the next phase of regulatory evolution arrives."
Contact
Felicity Spencer-Smith
PR & Communications Manager
felicity.spencer-smith@brownejacobson.com
+44 (0)3300451376
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