Barclays has joined the second cohort of the Financial Conduct Authority’s artificial intelligence live testing scheme, as Britain’s major banks accelerate their push into AI technology.
The FTSE 100 lender will participate alongside high street rival Lloyds Banking Group, which is entering through its Scottish Widows subsidiary. Also joining: credit reference agency Experian, payments company GoCardless and Swiss banking giant UBS.
Run by the FCA in partnership with Advai, a British AI testing specialist, the initiative offers participants a regulatory safe harbour to test their AI models before deploying them in high-stakes consumer decisions.
Speaking at Innovate Finance’s Global Fintech Summit, Jessica Rusu, the FCA’s chief data, information and intelligence officer, said the scheme “reflects our commitment to supporting the pace of change in AI, whilst demonstrating how regulators and industry can work together to harness innovation responsibly”.
Traditional lenders face mounting pressure to demonstrate tech credentials that rival the tech-native neobanks. Investors increasingly demand a coherent AI narrative showing concrete implications for costs and headcount.
UBS analysts warned earlier this year that banks would be “pressed hard” to articulate “what is being spent now and what it means for the future shape of expenses overall and headcount”.
The drive has sparked a flurry of AI alliances in recent months. Barclays partnered with Microsoft AI in a deal putting AI tools in the hands of some 100,000 bankers. NatWest signed with OpenAI and HSBC turned to French AI champion Mistral. NatWest, Lloyds and HSBC each rank in the top 20 of the Evident AI index, the global benchmark for AI adoption in banking.
Risks remain a concern. American regulators recently summoned Wall Street chief executives to an emergency meeting amid concerns that Anthropic’s newly released “Mythos” tool could pose systemic risks to the financial system.
The FCA launched its first AI live testing cohort last December, with Monzo, NatWest and Santander among the inaugural participants. The expanding programme offers a useful indicator of where the regulator will draw lines as AI embeds deeper into British finance.