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FCA review warns AI could reshape retail financial services by 2030

The FCA has published The Mills Review, setting out how AI could reshape retail financial services by 2030 and beyond, with industry figures warning that consumer trust, accountability and protections will be critical.

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The Financial Conduct Authority has published The Mills Review, setting out how AI could reshape retail financial services for consumers, firms, markets and regulators by 2030 and beyond.

The review was led by Sheldon Mills, executive director at the FCA, and commissioned by the regulator’s board. The FCA said it was the first work of its kind initiated by a regulator globally.

The report identified 4 major AI-driven shifts likely to affect retail financial services: the transformation of firm operations, the evolution of consumer journeys, the reshaping of competition and market power, and the amplification of fraud and cyber risks.

Research commissioned by the FCA found there is already consumer appetite for agentic AI in personal finance, with 20% of people, equivalent to 11m UK adults, likely to use AI that can act autonomously within pre-set goals. However, the FCA said consumers surveyed also had concerns around trust and control.

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The review concluded that AI was likely to become a defining force in retail financial services, transforming how firms operate, how consumers make financial decisions and how markets function.

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It said AI had the potential to improve access, personalisation and efficiency, but could also amplify risks around fraud, cyber security, consumer harm and market concentration.

Sheldon Mills, executive director at the FCA, said: “Artificial intelligence will transform financial services by 2030. It creates significant opportunities for consumers, firms and the wider economy.

“This report sets out a roadmap for how industry regulators and government can prepare for the next phase of AI-driven change in our world-leading financial services sector.”

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The review set out 7 recommendations for the FCA board and executive to consider. These include securing and adapting the regulatory perimeter, strengthening system-wide coordination and oversight, monitoring the transition to autonomous models, scaling up the FCA’s AI Lab, enabling the foundations for agentic finance, building an AI-enabled agentic supervisory model, and developing a public-interest AI-enabled financial capability service.

Ashley Alder, chair of the FCA, said: “The Board is enormously grateful to Sheldon for the rich, comprehensive report he’s delivered.

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“His work anticipates the fundamental change agentic AI will bring to financial services. It highlights how consumers and firms can reap significant potential benefits as well how risks can be managed.

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“As is clear in the report, we need to keep pace with a rapidly changing environment and the principles-based, outcomes focussed approach we’ve taken on AI – relying on the Consumer Duty and Senior Managers Regime – has been critical to us doing so.

“The recommendations build on work the FCA has been doing – not least allowing firms to test their use of AI with us – and our own use of AI to be a smarter regulator, more efficient and effective.”

The review builds on the FCA’s existing work on AI, including its AI Discussion Paper, AI Sprint and AI Lab, including AI Live Testing and its Supercharged Sandbox supported by NVIDIA.

The FCA said it would also launch an AI good and poor practice publication later this year, following direct engagement with firms.

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David Brooks, head of policy at Broadstone, said: “Pensions are complex, long-term financial arrangements where mistakes can have lasting consequences.

“While AI has a role to play in improving engagement and understanding, consumers need to treat it as a starting point, not a substitute for professional guidance, scheme information or regulated advice.

“As AI becomes more widely used, improving public understanding of its limitations will be just as important as improving the technology itself. Trust should be earned through accuracy and accountability, not assumed because an answer sounds convincing.

“One of the FCA’s biggest challenges may be protecting consumers from bad pension decisions driven by good-looking AI answers.

“Generative AI is excellent at sounding authoritative, but not always at being right. When retirement savings are involved, people need to understand that convenience is not the same thing as reliability.”

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Brian Byrnes, director of personal finance at Moneybox, said: “Artificial intelligence has the potential to transform personal finance by making high-quality financial guidance and advice more accessible, reducing costs and helping millions of people make smart financial decisions with greater confidence.

“However, as the technology becomes more capable, the regulatory framework must evolve alongside it. If AI is influencing financial decisions or providing financial guidance, it should be held to the same high standards and consumer protections as any other provider of regulated financial services. Innovation and consumer protection shouldn’t be competing priorities—they need to go hand in hand.

“AI will become an increasingly important part of how people manage their money and plan for the future, but trust will ultimately determine its success.

“The greatest opportunity lies in combining AI’s speed, efficiency and ability to personalise information with the expertise, oversight and accountability of regulated financial firms.

“Getting that balance right will allow the UK to lead the world in AI-enabled financial services while giving consumers the confidence to embrace the technology.”

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