The Financial Conduct Authority (FCA) has published the Mills Review, about how AI could affect and reshape financial services for consumers, companies, markets and regulators by 2030 and beyond.
In January, the FCA launched a review into the implications of advanced AI on consumers, retail financial markets and regulators. The Mills Review draws on views from across the financial services industry and identifies four major AI-driven shifts that are likely to have an impact on retail financial services:
- transformation of firm operations;
- evolution of consumer journeys;
- reshaping of competition and market power; and
- amplification of fraud and cyber risks.
The report finds that consumers are already likely to use AI that can act autonomously with pre-set goals in their personal finance, but are concerned about trust and control of AI. The review has concluded that AI is likely to become a defining force in retail financial services as it reshapes how firms operate, consumers make financial decisions, and how markets function, AI has potential to improve access, personalisation and efficiency, but could also increase risks associated with fraud, cyber security, consumer harm and market concentration. The four key findings are:
- Retail financial services are moving from human-led, towards AI-enabled, continuous and delegated services.
- AI could reshape the sector by 2030, changing how firms operate, consumers make decisions, markets compete and risks emerge.
- AI could improve outcomes and support growth by reducing friction and tackling long-standing challenges, such as advice gaps, low switching and protection gaps. However, it could also amplify risks associated with fraud, cyber security and consumer harm.
- Consumer adoption will depend on trust, control and access, even though 20% of UK adults are already open to AI making decisions for them.
The Mills Review sets out seven recommendations:
- Secure and adapt the regulatory perimeter
- Strengthen system-wide coordination and oversight
- Monitor transition to autonomous models and adapt regulatory frameworks
- Scale up the FCA’s AI Lab to support AI models and system innovation in financial services
- Enable foundations for agentic finance
- Build and adopt an AI-enabled agentic supervisory model
- Develop a trusted public-interest AI-enabled financial capability service.
