{"id":707768,"date":"2026-01-20T03:28:13","date_gmt":"2026-01-20T03:28:13","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/707768\/"},"modified":"2026-01-20T03:28:13","modified_gmt":"2026-01-20T03:28:13","slug":"britain-needs-ai-stress-tests-for-financial-services-lawmakers-say","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/707768\/","title":{"rendered":"Britain needs ‘AI stress tests’ for financial services, lawmakers say"},"content":{"rendered":"\n

LONDON, Jan 20 (Reuters) – Britain\u2019s financial watchdogs are not doing enough to stop artificial intelligence<\/a> from harming consumers or destabilising markets, a cross\u2011party group of lawmakers said on Tuesday, \u200burging regulators to move away from what it called a \u201cwait and see\u201d approach.<\/p>\n

In a \u200creport on AI in financial services, the Treasury Committee said the Financial Conduct Authority and the Bank of England should start \u200crunning AI\u2011specific stress tests to help firms prepare for market shocks triggered by automated systems.<\/p>\n

The committee also called on the FCA to publish detailed guidance by the end of 2026 on how consumer protection rules apply to AI, and on the extent to which senior managers should be expected to understand the systems \u2060they oversee.<\/p>\n

\u201cBased on the evidence I’ve seen, I do \u200cnot feel confident that our financial system is prepared if there was a major AI-related incident and that is worrying,\u201d committee chair Meg Hillier said in a statement.<\/p>\n

TECHNOLOGY CARRIES ‘SIGNIFICANT RISKS’<\/p>\n

A \u200drace among banks to adopt agentic AI, which unlike generative AI can make decisions and take autonomous action, runs new risks for retail customers, the FCA told Reuters late last year.<\/p>\n

About three\u2011quarters of UK financial firms now use \u200bAI. Companies are deploying the technology across core functions, from processing insurance claims to performing credit \u200cassessments.<\/p>\n

While the report acknowledged the benefits of AI, it warned the technology also carried \u201csignificant risks\u201d including opaque credit decisions, the potential exclusion of vulnerable consumers through algorithmic tailoring, fraud, and the spread of unregulated financial advice through AI chatbots.<\/p>\n

Experts contributing to the report also highlighted threats to financial stability, pointing to the reliance on a small group of U.S. tech giants for AI and cloud services. Some also \u2060noted that AI\u2011driven trading systems may amplify herding behaviour in \u200bmarkets, risking a financial crisis in a worst-case scenario.<\/p>\n

An FCA \u200bspokesperson said the regulator welcomed the focus on AI and would review the report. The regulator has previously indicated it does not favour AI\u2011specific rules due to the \u200dpace of technological change.<\/p>\n

The \u2060BoE did not respond to a request for comment.<\/p>\n

Hillier told Reuters that increasingly sophisticated forms of generative AI were influencing financial decisions. \u201cIf something has gone wrong in the system, that could \u2060have a very big impact on the consumer,\u201d she said.<\/p>\n

Separately, Britain’s finance ministry appointed Starling Bank CIO Harriet Rees and \u200cLloyds Banking Group \u2019s Rohit Dhawan as \u201cAI Champions\u201d to help steer AI adoption in financial \u200cservices.<\/p>\n

(Reporting by Phoebe Seers; Editing by Tommy Reggiori Wilkes)<\/p>\n","protected":false},"excerpt":{"rendered":"LONDON, Jan 20 (Reuters) – Britain\u2019s financial watchdogs are not doing enough to stop artificial intelligence from harming…\n","protected":false},"author":2,"featured_media":707769,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4317],"tags":[748,212404,16489,14637,7558,4882,751,105,49268,218,23858,32226,16,15],"class_list":{"0":"post-707768","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-mental-health","8":"tag-britain","9":"tag-consumer-protection-rules","10":"tag-fca","11":"tag-financial-conduct-authority","12":"tag-financial-services","13":"tag-financial-stability","14":"tag-generative-ai","15":"tag-health","16":"tag-meg-hillier","17":"tag-mental-health","18":"tag-the-bank-of-england","19":"tag-treasury-committee","20":"tag-uk","21":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115925306893098447","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/707768","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=707768"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/707768\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/707769"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=707768"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=707768"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=707768"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}