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The Financial Conduct Authority (FCA) has published the Mills Review: a detailed report that includes seven recommendations on how the FCA should adapt to the use of AI in retail financial services.
- The FCA will review the regulatory perimeter within three to six months.
- The Senior Managers Regime and Consumer Duty will remain unchanged, albeit we expect clarification on how these regimes will apply in the context of Autonomous AI.
- A “good and poor practice” publication is expected later this year.
1. Mills Review
In January 2026, the FCA launched the Mills Review1 to consider artificial intelligence (AI) in the context of retail financial services. Sheldon Mills spearheaded the review.
The FCA published the resulting detailed 147-page report2 on July 6, 2026, with a series of seven recommendations, ostensibly made for the consideration of the FCA Board. Mr Mills positioned the report as follows:
Some of the findings in the report acknowledge well understood views, e.g., at one point, the report suggests that the uptake of AI in this sector will depend on trust, control and access. At another point, the report suggests that, as AI becomes more embedded, its governance becomes increasingly important.
However, the study3 (commissioned by the FCA and published alongside the report) will be of interest to retail facing firms for its analysis into how retail customers currently use and view AI, and helpful to firms interested in expanding their use of AI in retail facing activities.
Some takeaway points from the study:
- AI is widely visible but not yet widely trusted with money. 16% report using AI to assist them in relation to personal finance, but mainly as an assistive tool-to summarise, explain, simplify, and compare information.
- There is a sizeable group of consumers resistant to AI-enabled financial services—between a quarter and a third of consumers express negative views.
- Concerns reflect issues of accountability and protection, e.g., a concern as to a misuse of personal and financial data was at 68%, a lack of protection if something goes wrong was at 67%. There was also a key concern around a concentration of power among large firms—registered at 65% among respondents.
- Safeguards and control are central to adoption decisions. The most important drivers are protection if something goes wrong (32%) and evidence of accuracy and reliability (30%). Some consumers also focused on the importance of being able to opt out and access human support, and understanding how firms make decisions.
The report identifies four major AI-driven shifts likely to impact retail financial services:
- Transformation of firm operations
- Evolution of consumer journeys
- The reshaping of competition and market power
- Amplification of fraud and cyber risks
The report discusses and analyses each shift in detail with the last point in particular likely to be a focal point for the FCA, underscoring its ongoing concern about operational resilience and cyber crime.
The report is also candid about the complexities of defining common international standards, acknowledging that a desire for growth and international competitive advantage, national security and technological sovereignty may complicate efforts to this end.
Footnotes
1. Review into the long-term impact of AI on retail financial services (The Mills Review)
2. AI and the future of retail financial services (The Mills Review)
3. Yonder/ FCA AI Consumer Research
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