Tisa Urges UK Regulators to Take Action Against AI Search Engine Overreach
Artificial Intelligence (AI) is reshaping the landscape of financial services, and its impact is becoming increasingly evident. In a recent submission to the Treasury Select Committee, Tisa, a not-for-profit member organization, emphasizes the transformative potential of AI while highlighting the critical need for regulatory measures to safeguard consumers from potential harm.
The Growing Adoption of AI in Financial Services
According to the Bank of England’s 2024 survey on AI in UK financial services, 75% of firms are currently utilizing AI technologies, with another 10% planning to adopt these innovations in the next three years. This trend underscores the significance of AI in enhancing operational efficiency and customer engagement.
Benefits of AI in Financial Services
The incorporation of AI into financial services brings numerous advantages, including:
- Enhanced Efficiency: Streamlining operations to reduce costs and improve service delivery.
- Improved Risk Management: Utilizing advanced algorithms to assess and mitigate risks effectively.
- Personalized Services: Offering tailored advice, product recommendations, and investment strategies to consumers.
Addressing Regulatory Gaps in AI
Despite the benefits, Tisa warns of significant regulatory gaps that could expose consumers to harmful practices and misinformation, especially when relying on publicly available AI tools for financial guidance. The organization raises concerns about the risks posed by unregulated AI tools, including generative search engines that may offer misleading or inappropriate financial advice.
Call for Regulatory Oversight
Tisa is urging the Financial Conduct Authority (FCA) and HM Treasury to include AI search engines within the regulatory framework to protect consumers from potentially hazardous financial advice. Key recommendations include:
- Convene industry stakeholders to address regulatory and cultural barriers.
- Accelerate initiatives like Open Finance to enhance data availability and transparency.
- Review existing regulations to ensure they remain relevant and effective.
Need for Updated Guidelines
Tisa advocates for new guidance focusing on crucial aspects such as explainability, accountability, and bias mitigation in AI systems. Phil Turnpenny, policy executive at Tisa, states:
“Our research shows that properly designed and regulated AI has the power to improve financial access and outcomes — especially for underserved groups.”
Urgent Action Required
However, Turnpenny emphasizes the urgency of addressing existing issues: “Not all AI is created equal. Search engine-based AI tools are increasingly being used as a source of financial advice — often without oversight, transparency, or accountability. This has created a wild west situation and poses serious risks, particularly for vulnerable consumers who may be misled by confident-sounding but inaccurate information.”
“That’s why we’re calling on the FCA and HMT to regulate this space urgently. At the same time, we must draw a clear line between risky, unregulated tools and those designed with consumer protection in mind.”
For more insights into the regulatory landscape of AI in financial services, you can visit Bank of England and Tisa.
