FCA report on young investors and AI: Experts comment

CEO of Boring Money, Holly Mackay, reacts to the FCA’s report on young investors and using AI:

 
Consumers have always been confused about what’s regulated advice and what is simply a tip or information. However so far, our research shows that consumers maintain a healthy scepticism about AI. Whilst usage is increasing – and younger men are six times more likely to use AI than investors over 65 – reliance on AI as the sole source of information remains very limited. AI can be very helpful for factual information but as with anything we read or see online, the credibility of the source is vital and should always be checked.
 

Boring Money data:
 

• 65% of Under 40s are comfortable with AI-Supported Financial Services vs. 57% of those aged 40+
• 40% of investors under 40 trust AI as an information source about investing, compared to 11% of under 40s

Investor preferences for having a human element:
 

• 51% of those under 40 would be comfortable with a hybrid model where AI conducts initial analysis and a human adviser reviews it compared to 44% of those 40+.
• 9% of those under 40 have acted directly on AI information or output for financial purposes without seeking further validation, compared to 3% of those 40+

Survey of 6,465 nationally representative UK adults, January 2026

Survey of 3,097 nationally representative UK adults (May 2026)

Charlotte Hill, Partner at Katten Muchin Rosenman UK LLP:

“The FCA’s findings highlight an important disconnect between consumers’ growing confidence in using AI and their understanding of the regulatory protections that apply to it.  AI can be an extremely useful tool for investors: it can help explain unfamiliar terminology, analyse information and make complex markets more accessible.  The concern is not the use of AI itself, but the assumption that an AI-generated answer necessarily comes with the same regulatory safeguards as advice from an authorised firm.

The finding that 44% of respondents believe AI-generated financial information is regulated is particularly striking.  The regulatory analysis turns on the function being performed, rather than simply the technology being used.  A general-purpose chatbot is very different from a service designed and deployed to provide regulated investment advice, and that distinction may not be obvious to a consumer sitting in front of a screen.  That creates challenges for regulators and firms alike.  As AI becomes embedded in financial decision-making, firms will need to think carefully about how their tools are described, what consumers are likely to understand them to be doing, and how responsibility is allocated when AI moves from providing information towards influencing an investment decision.

Ultimately, technological sophistication does not remove the need for regulatory clarity – it makes it more important.”