26% of UK adults already trust a general-purpose AI assistant — ChatGPT, Claude, Gemini — for financial advice, with no check that it suits them and no recourse if it is wrong. Around 9% get regulated advice. The advice gap the industry has worried about for a decade is being closed, just not by regulated firms.
One of that 26% is, right now, asking an assistant whether to overpay a mortgage, move a pension, or cancel a policy, with no check that the answer suits them, no one accountable if it is wrong, and no way to complain. They won't raise it at their next review. You can't see it in your data. And it is happening at scale.
Take a specific example of that. A 58-year-old with £180,000 in a workplace pension, three years from retirement, asks a general-purpose assistant whether to transfer into a personal pension to cut fees. The assistant answers fluently and confidently. It cannot see her attitude to risk, whether she holds other savings, or whether the scheme she is leaving carries safeguarded benefits she would forfeit. If the answer is wrong, there is no Financial Ombudsman route, no compensation scheme, and no adviser who ever knew the conversation took place.
In July, an independent report to HM Treasury — the Financial Services AI Adoption Plan — set out ten recommendations for scaling AI across UK financial services. Most of it is sensible, and most of it is already being widely summarised. We want to focus on the part that changes what a regulated firm should do next: the question the report deliberately left open, and why waiting for the answer is the most expensive move available.
The question the report leaves open
That 26% is not a rounding error, and it is not waiting. Regulated financial advice — the kind where a qualified firm recommends what you personally should do with your money, and is answerable for it — is expensive to give, so it doesn’t reach most people. Targeted support, simplified advice, and awareness campaigns have nudged the number without changing it. A free, instant assistant changes it overnight,and one in five UK adults say they are open to letting AI make the decision for them, not just inform it.
The report's answer is to ask the FCA to review the regulatory perimeter for AI-enabled services. The regulatory perimeter is simply the boundary around what counts as a regulated activity: step inside it — telling a customer what they personally should do with their money — and you need FCA authorisation and carry the full weight of the rules; stay outside it — giving general information or guidance — and you don't. The report wants the FCA, with government, to decide where that boundary should sit for AI, and states plainly that it has “intentionally not defined or prescribed” where the new line should fall.
That is the right call for an independent report. It is the wrong posture for a bank, an insurer or a wealth manager to adopt.
Waiting is the expensive option
Here is the trap. The natural instinct of a regulated firm is to wait for clarity. The perimeter is unresolved, the FCA review has not started, and moving early into a grey area feels like the risky choice. So the plan becomes: prepare, watch, and act once the rules are firm.
The problem is what happens during the wait. A perimeter review runs for months, then policy work, then implementation. Through all of it, customer trust and habit keep migrating — not to your app, but to an assistant that answers instantly, for free, at eleven at night, about whether to move a pension.
Trust and habit are sticky. Once a customer's default question about their money goes to a general-purpose model instead of the institution that holds it, that behaviour is hard to reverse. By the time the perimeter is redrawn to let you compete properly, the relationship you were protecting has already thinned. The firm that waited for permission will have done everything correctly and still lost the ground.
Inaction is not the safe option here. It is the slow, deniable version of losing.
