The FCA has formally launched a strategic Review into the long-term impact of AI on retail financial services by 2030 and beyond. Led by FCA Executive Director Sheldon Mills, this Engagement Paper, known as the Mills Review seeks input from consumers, firms and stakeholders on four interconnected themes that span technology evolution, market impacts, consumer trends and regulatory approaches.
Background and strategic intent
AI is already embedded across financial services, from fraud detection and underwriting to customer interfaces. While current generative AI models have accelerated adoption, the FCA recognises that future developments, agentic AI, neuromorphic computing, and even quantum-enabled systems, could fundamentally alter how financial services are delivered and consumed. These shifts lie at the heart of the Mills Review’s strategic horizon. The FCA emphasises that it does not intend to introduce AI-specific regulation at this stage. Instead, the authority will test whether existing outcome-focused frameworks, such as the Consumer Duty, Senior Managers and Certification Regime (SM&CR), Operational Resilience standards and the evolving Critical Third Parties regime remain sufficiently robust for an AI-enabled future.
Core Themes of the Review (to 2030)
Theme 1: Evolution of AI Technology
The FCA seeks evidence on how AI may evolve and interact with adjacent technologies. Future systems are envisioned as:
- More autonomous and adaptive than today’s models;
- Interconnected across financial platforms and systems;
- Capable of acting on behalf of consumers (agentic AI)
The authority is particularly interested in how these developments could influence data flows, ecosystem structures, and consumer choice, including whether AI marketplaces will be more open or dominated by hyperscalers.
Theme 2: Impact on Markets, Firms and Competition
AI has the potential to transform traditional business models across banking, insurance, lending and investments. Possible consequences include:
- Hyper-personalised products and services;
- Lower operational costs, particularly for digital-native firms;
- New classes of specialised entrants such as AI intermediaries;
- Feedback loops and network effects that could entrench incumbents.
While innovation could enhance value for consumers, it may also generate opaque, AI-driven risks including model bias, automated mis-selling and new forms of systemic fraud, all of which could challenge existing competitive dynamics.
Theme 3: Consumer Trends and Outcomes
Consumers are increasingly relying on AI in their financial lives – from budgeting tools to automated investment decisions. The Review examines how this delegation of decision-making could affect:
- Consumer trust and agency;
- Financial literacy and empowerment;
- Inclusion and equitable access.
The FCA is particularly concerned about risks of opaque AI decisioning, reduced consumer understanding, and the possibility of new forms of exclusion or exploitation. Evidence is sought on consumer adoption patterns, including differences across demographic groups and financial confidence levels.
Theme 4: Regulatory Approach for the Future
Rather than proposing new laws, the FCA is exploring how existing regulatory frameworks might be adapted to an AI-driven environment. Topics under consideration include:
- How responsibilities under SM&CR retain relevance as AI systems automate processes;
- Whether Consumer Duty expectations remain clear when outcomes are mediated by AI;
- The role of AI assurance, auditability and accountability in supervision and enforcement.
The FCA also flags the need for enhanced regulatory technological capabilities – both in how it monitors firms and how it deploys AI internally to detect risks at pace. Collaboration with domestic regulators such as the Information Commissioner’s Office (ICO) and international bodies is highlighted as vital in meeting cross-border and systemic challenges.
Call for Input: Shaping the Future
The Mills Review is a forward-looking call for evidence rather than a policy proposal. The FCA is seeking views on:
- How AI technology is likely to evolve in retail financial services;
- The impact on competition and market structure;
- Changing consumer behaviour and potential risks;
- Whether the existing regulatory framework remains fit for purpose.
Responses are due by 24 February 2026 and will inform the FCA’s long-term supervisory and policy approach into the 2030s.
Broader Regulatory and Political Context
The Mills Review responds to mounting regulatory and parliamentary pressure to proactively address AI risks in finance. UK lawmakers have called for AI-specific stress tests and clearer guidance on regulatory expectations, arguing that current oversight may be inadequate to prevent consumer harm or market instability in an increasingly AI-dependent financial system.
At the same time, the FCA itself has signalled a preference for innovation-friendly frameworks and collaborative industry engagement over rigid rule-making, reflecting a broader debate on how high-growth technologies should be governed without stifling competitiveness.
How Complyport Can Help?
At Complyport, we help firms manage evolving regulatory reporting requirements by:
- Regulatory Engagement and Supervisory Readiness: We help firms prepare board briefings, regulatory submissions and responses to FCA engagement exercises, including contributions to calls for input such as the Mills Review. Our support ensures firms can demonstrate proactive risk management and strategic alignment with regulatory expectations.
- SM&CR Accountability Frameworks: We assist in clarifying senior management responsibility for AI systems, strengthening oversight arrangements and ensuring decision-making and challenge are appropriately documented.
- AI Governance and Risk Assessments: We conduct gap analyses to assess how AI use cases align with existing FCA requirements, identifying conduct, operational, model and oversight risks. We help firms implement proportionate governance structures, controls and documentation to evidence accountability and good customer outcomes.
Contact Us
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