FLA responds to Mills Review

The Mills Review, led by FCA executive director Sheldon Mills and commissioned by the Board of the Financial Conduct Authority (“FCA”), is the first work of its kind initiated by a regulator globally.

Drawing on views from across the financial services landscape, the report identifies four major AI‑driven shifts likely to impact retail financial services: the transformation of firm operations; the evolution of consumer journeys; the reshaping of competition and market power; and the amplification of fraud and cyber risks.

The report finds there is already consumer appetite for the use of agentic AI in personal finance, with research commissioned by the FCA showing that one fifth of people are likely to use AI that can act autonomously within pre-set goals. However, consumers in the survey are concerned about trust and control of AI.

The Review concludes that AI is likely to become a defining force in retail financial services, transforming how firms operate, how consumers make financial decisions and how markets function. 

Shanika Amarasekara MBE, Chief Executive at the Finance & Leasing Association (pictured above), said, “AI is reshaping consumer finance faster than many people realise. It's changing how people search, compare and make financial decisions, and the Mills Review rightly recognises that we are moving towards a world where financial support is more personalised, continuous and, in some cases, delegated.

"For lenders and finance providers, the prize is enormous. AI can make borrowing simpler, improve fraud detection, identify financial difficulties earlier and deliver better outcomes for customers. But innovation will only succeed if people trust it. Customers need to understand when AI is being used, have confidence that decisions are fair and transparent, and remain in control.

"Getting the next phase right matters far beyond financial services. Finance & Leasing Association (“FLA”) members provide £163 billion of new lending every year, financing the real economy by helping millions of consumers make essential purchases and enabling businesses across the UK to invest, grow and create jobs. Responsible adoption of AI can make that finance faster, more efficient and more accessible.

"The challenge now is to strike the right balance. Firms need a policy environment that gives them the confidence to innovate and invest responsibly, while ensuring consumers remain protected. Policymakers should also consider the growing influence of AI tools operating outside the regulated financial sector. As more people turn to AI to help make financial decisions, the rules must evolve to ensure trust, fair competition and innovation continue to work hand in hand."

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