The Financial Conduct Authority has begun working with major firms to test artificial intelligence in a controlled environment to better understand its benefits and risks.
The AI Live Testing initiative is the first of its kind in the financial sector and is designed for firms that are ready to deploy AI in UK financial markets.
Participants receive tailored support from FCA regulators and technical partner Advai to help them develop, assess and implement safe and responsible AI systems.
The first group of firms taking part includes Gain Credit, Homeprotect part of the Avantia Group, NatWest, Monzo, Santander, Scottish Widows part of Lloyds Banking Group and Snorkl.
The FCA said the testing is helping firms address questions around evaluation frameworks, live monitoring, governance and risk management to ensure AI can be deployed responsibly for consumers and markets.
Many of the applications currently being tested relate to retail financial services. Use cases include applying AI to debt resolution, financial advice, customer engagement, complaints handling and tools that support smarter spending and saving decisions.
Jessica Rusu, chief data, information and intelligence officer at the FCA, said: “Our new AI Live Testing service helps firms who are ready to use AI in live markets.
“By working closely with firms and our technical partner Advai, we’re helping to make sure that AI is developed and deployed safely and responsibly in UK financial markets.”
The FCA said the project will help it understand how AI may shape financial markets and support its future regulatory approach.
AI Live Testing complements the regulator’s Supercharged Sandbox, which supports firms in the discovery and experimentation stages.
Applications for the second cohort open in January 2026, with testing due to begin in April.
