The United Kingdom’s Financial Conduct Authority (FCA) has issued a broad regulatory blueprint for retail financial services, warning that retail financial services are hurtling toward total automation driven by autonomous “agentic AI.”
The landmark report, “AI and the future of retail financial services,” spearheaded by executive director Sheldon Mills, details a structural shift away from periodic, human-led decisions toward continuous, automated financial services that could increasingly rely on programmable financial infrastructure.
“The central shift is from human-led, episodic financial activity towards services that are AI-enabled, continuous and delegated,” Mills wrote. In January, the FCA launched a review into the implications of advanced AI on consumers, retail financial markets and regulators.
The 147-page report comes at an inflection point where generative AI meets institutional crypto adoption. As financial systems transition to autonomous portfolio and cash management, legacy fiat banking rails are seen as structurally incapable of matching machine transaction speeds. This positions systemic stablecoins and tokenized bank deposits as potential settlement infrastructure for AI-driven financial services.
It outlines seven recommendations for the FCA to consider, including enabling “the foundations for agentic finance,” which would support the development of trusted agent protocols that would underpin use of agentic AI and “scaling up the FCA’s AI Lab to support AI models and system innovation in financial services.”
FCA envisions agents on “autonomy spectrum”
The Mills Report suggests that the catalyst is the rapid evolution of AI from predictive models into independent agents operating on an “autonomy spectrum.” At the far end of this spectrum, humans act as mere “observers” while AI continuously manages capital.
Screenshot of table header that sets out how FCA sees operator activities may change as they move across the AI autonomy spectrum. Source: Financial Conduct Authority.
The acceleration of this shift has outpaced prior regulatory timelines, with more than 20 frontier models released since late 2025 alone.
“Firms are moving from systems that recommend actions to systems empowered and trained to take them, and consumers will soon gain agents that act on their behalf,” Mills said in the report’s foreword. FCA research shows that 20% of UK adults are already open to letting AI make autonomous financial choices.
For these AI agents to execute multi-layered transaction strategies seamlessly, they require programmable, instantaneous settlement mechanisms. Traditional multi-day settlement latency remains an operational bottleneck. Because systemic stablecoins and tokenized assets live natively on programmable ledger networks, they provide the friction-free, atomic settlement needed for automated protocols to move capital instantly without human clearance.
However, this automation introduces severe corporate governance risks regarding legal accountability.
The review highlights growing industry anxiety over this ambiguity, noting that one CEO observed that the financial sector may eventually require a “Turing test” to accurately distinguish between human intent and autonomous algorithmic behavior in the market.
“The FCA’s Mills Review reinforces that firms should treat agentic AI as an accountability and governance issue now, while providing greater confidence to innovate responsibly as AI adoption accelerates,” Emma Banymandhub, CEO of The Payments Association, said in a statement. “AI has enormous potential for financial services, but realising that potential will depend on strong governance, clear accountability and maintaining consumer trust.”
Mills, who is leaving after eight years at the FCA, told The Financial Times ahead of the report’s release that managers would still need to be accountable for the actions of their AI models. “You need a human on the hook for what they’re doing,” he said.
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