Synthetic intelligence (AI) expertise is utilized by all however 1% of UK monetary companies corporations as the controversy over its use within the sector involves an finish, in line with a serious annual research by Finastra.
In its Monetary companies state of the nation 2026 report, the IT provider described AI because the “connective tissue” of the finance sector and revealed that the expertise’s evolution can also be driving up spending in different areas, comparable to safety and cloud.
Finastra CEO Chris Walters stated establishments are not debating whether or not to undertake AI, however are centered on the place it delivers tangible worth and the way it may be deployed responsibly.
“Solely 2% of [global] respondents say they aren’t utilizing AI in any respect, which underscores how decisively the trade has crossed the edge,” he stated.
The report stated: “AI now sits on the coronary heart of economic innovation. Not confined to again‑workplace automation, it’s powering actual‑time fraud detection, personalised product suggestions, clever underwriting and dynamic buyer engagement.
AI is turning into the connective tissue of banking – the intelligence layer that hyperlinks knowledge, channels, and companies into one thing coherent and responsive Finestra report
“[AI] reduces friction, accelerates choices and tailors experiences in ways in which really feel intuitive to prospects. It’s turning into the connective tissue of banking – the intelligence layer that hyperlinks knowledge, channels and companies into one thing coherent and responsive.”
The report revealed the highest AI use circumstances finance corporations are at present operating or piloting. These embrace danger administration and fraud detection (71%), knowledge evaluation and reporting (71%), customer support and help assistants (69%) and doc intelligence administration (69%). It stated the highest three priorities for the yr forward are AI-driven personalisation, agentic AI for workflow automation, and AI mannequin governance and explainability.
Over 1,500 senior executives at giant finance varieties in 11 areas have been questioned within the Finastra survey.
AI can also be not directly forcing banks to take a position extra closely in different applied sciences within the yr forward. For instance, spending on safety is anticipated to rise by a mean of 40% in 2026.
That is partly because of AI-related threats. The report stated “escalating digital threats – significantly these linked to AI” are driving a projected 40% common improve in safety spend over the subsequent yr.
A complete of 43% of corporations stated always evolving dangers are their largest safety problem, whereas 40% stated AI deployment itself was.
Modernise for AI
One other byproduct of AI funding is the necessity for finance corporations to modernise expertise. 9 out of 10 surveyed corporations plan to put money into modernisation this yr, partly to allow them to scale AI. The adoption of cloud expertise is central to this effort, with 29% of respondents prioritising cloud adoption.
“Cloud is not a vacation spot; it’s the working surroundings for contemporary finance, with 84% of respondents reporting that they’re utilizing some cloud options,” stated the report.
Walters stated: “Expertise choices now sit on the centre of belief, resilience and buyer expertise. Establishments are anticipated to maneuver shortly, but additionally responsibly, as regulatory scrutiny will increase, and prospects demand monetary companies that work reliably, securely and personally each time.
“This yr’s findings present a sector transferring decisively past experimentation and into execution.”
Banks are seeing rising returns on their AI investments. In line with analysis by Lloyds Banking Group, 59% of corporations reported AI-driven productiveness features in 2025, in contrast with 32% in 2024.
In itsMonetary establishments sentiment survey 2025, Lloyds discovered that 21% of respondents imagine AI is straight driving enterprise progress, in contrast with 8% within the 2024 survey.
In the meantime, a 3rd (33%) of respondents stated AI is enhancing buyer experiences, up from 14% within the earlier survey. The identical quantity stated they’ve deeper buyer insights by means of AI, in contrast with 18% the earlier yr.
