Adoption is broadening
The Bank of England and Financial Conduct Authority published their fourth joint AI survey on 26 October, drawing responses from 196 financial firms. The report says adoption is spreading across more business areas and increasingly includes generative AI, AI agents and third-party implementations. Among smaller firms, 73% reported using AI; 58% said their use was predominantly based on large language models, while operations was the most commonly cited function at 64%. The survey is descriptive and does not certify any individual firm’s controls.
Controls are the pressure point
Respondents identified benefits in efficiency, decision support and risk management, but also risks involving governance, operational resilience, data protection, consumer outcomes, third-party dependency and financial stability. Thirty percent of smaller firms cited data protection or existing IT systems as constraints. The report also notes that 57% of firms considered sustainability impacts, yet 82% did not report them externally. For merchants and fintech partners, the practical issue is supply-chain visibility: a regulated provider may depend on models, cloud services and data processors several layers removed from the customer-facing product.
What it means for merchants
Before using a financial provider’s AI-enabled service, merchants should ask who supplies the models, where customer data flows, how outages are handled, and which human remains accountable for adverse decisions.
Read the original announcement
Bank of England · 26 Oct 2026This brief summarizes the linked primary source. Claims and reported figures have not been independently audited by Payment Guide.