The Treasury Committee is launching an inquiry to examine the impacts of the increased use of artificial intelligence (AI) in financial services.
Provision of financial advice is already being effected by AI and this is sure to grow exponentially over the coming years. The launch of the inquiry reflects that reality.
The Committee’s call for evidence is open now, with the aim being for the Treasury to better understand how financial services can utilise AI whilst protecting consumers against the risks.
Figures from the Bank of England show that 75% of firms are already using AI, with a further 10% planning to use it over the next three years.
The inquiry is set to explore how AI is currently used by City firms as well as what opportunities it brings for innovation in the financial services sector.
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MPs may also consider the potential impact on employment and look at how the UK compares to other countries in both its competitiveness and approach.
Another element of the inquiry particularly relevant to advisers is a focus on the safeguards that may be needed to protect consumers, particularly vulnerable ones who may be at risk of bias.
The Committee wants input from ‘a range of voices’ including within the finance industry, AI sector, consumers and other experts. The deadline for submissions is Monday 17 March.
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Chair of the Committee, Dame Meg Hillier, said: “Successive governments have made clear their intention to embed and expand the use of AI to modernise the economy.
“My committee wants to understand what that will look like for the financial services sector and how the City might change in the coming years as that transformation gathers pace.
“It’s critically important the City can capitalise on innovations in AI and continue to be a world leader in finance. We must, though, also be mindful of ensuring there are adequate safeguards in place to mitigate the associated risks, particularly for customers. This piece of work will allow us to see the full picture.”
Nina Cherry, wealth consultant at Simplify Consulting, said: “This is an opportunity for firms to provide their input as to the use of AI is well timed. There are so many innovative use cases for the application of AI within the industry and many of these are already bearing fruit.
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“As this adoption gathers pace, we absolutely need to be mindful of the risks as well as the benefits, and we do need to understand the impact this will have on the workforce,” she continued.
“AI is a powerful tool to support and empower people rather than replace them. It will be interesting to see the responses from this call for evidence and what direction the Treasury Committee decides to take as a result.”
