The Financial Conduct Authority has selected eight companies, including Barclays, Experian, Lloyds Banking Group’s Scottish Widows and UBS, for a program to test AI applications in a live environment.
The regulator is running an AI live testing scheme with Advai, a London-based company focused on automated AI assurance.
Access deeper industry intelligence
Experience unparalleled clarity with a single platform that combines unique data, AI, and human expertise.
learn more
The program aims to help participating companies consider issues such as risk management and real-time monitoring as they prepare to use AI in services that impact consumers and financial markets.
The applications covered a variety of AI approaches and demonstrated how rapidly the field is changing. These ranged from agent AI and small-scale language models to new systems such as neural symbolic AI.
In the second cohort, companies are evaluating both consumer and B2B usage. These include AI-supported investment guidance, credit score information for consumers, payments on behalf of customers, anti-money laundering checks, and know-your-customer features.
Applications for the second round opened in January 2026, and testing began in April.
This work is expected to be completed by the end of the year, with an evaluation report due in the first quarter of 2027.
Along with Barclays, Lloyds and UBS, other companies selected include Experian Plc, Aereve, Coadjute, GoCardless and Palindrome. The FCA said the trial will take place in a controlled live market environment involving real customers.
The previous group, which included NatWest Group, Monzo Bank and Scottish Widows, tested the AI application for about six months.
The FCA has announced a 49% year-on-year increase in applications to its regulatory sandbox and innovation pathway. The report also found that activity in the fintech market is largely in line with regulators’ demand for innovation services, particularly in areas such as AI.
The regulator said it will publish a report in late 2026 outlining good and bad practices for the use of AI in financial services.
Separately, UK regulators, the Bank of England, the government and the National Cyber Security Center are in close consultation about potential risks associated with Anthropic’s unreleased AI model Mythos, Bloomberg reported, citing sources.
Earlier this month, U.S. Treasury Secretary Scott Bessent convened an emergency meeting of Wall Street executives to ensure they understood the potential future risks posed by the technology.
Jessica Luss, Chief Data, Information and Intelligence Officer at the FCA, commented:
“With tailored support from the FCA and Advai, this work reflects our commitment to supporting the pace of change in AI, while also demonstrating how regulators and industry can work together to leverage innovation responsibly.”
Separately, the UK government is considering introducing a common testing regime for general-purpose AI systems used by UK lenders, after the Bank of England last year raised concerns about how such models are assessed.Financial Times (FT).
The idea was submitted to the Department for Science, Innovation and Technology by Harriet Rees, Starling Bank’s chief information officer, last month.
