FCA sets out its stance on AI regulation in the UK financial market
Yesterday, the UK Financial Conduct Authority (FCA) published an AI Update, setting out its approach to AI and stating that it has no plans to roll out additional AI regulation. Instead, it will "rely on existing frameworks, which mitigate many of the risks associated with AI”.
In a previous AI Update, the FCA reiterated what it described as its dedication to support the UK’s financial markets' safe and responsible AI adoption. The regulator supports that firms should be able to trial, develop and test AI to realise the potential it offers for innovating and advancing in the interests of consumers and markets, while continuing to focus on the effective management of risks.
The FCA’s stance emphasises two key points:
- Pro Innovation stance: drive for AI uptake and keep the UK a competitive fintech market.
- Proportionate oversight: balancing the protection of consumers and the integrity of the markets with flexibility and without imposing disproportionate regulatory burdens.
As part of its commitment, the FCA collaborates with the international community and other regulatory bodies to share insights and learn how AI is being applied. It also co-shares the "AI Consortium" with the Bank of England and actively contributes to related research initiatives.
Staying in pace with AI and innovation is challenging. Maintaining this approach suggests the UK’s intentions to create the right environment for innovation to flourish responsibly.
For more details, read FCA's website.