The use of AI in financial services faces a ‘reality check’, a new report from Aveni has warned, with firms facing major gaps in critical areas like governance, data quality, and cultural readiness.

The Scottish fintech’s report, The AI Innovation Shift in Financial Services, argues that artificial intelligence represents a “structural break” from the steady stream of digital improvements firms have implemented over the last decade, and has already fundamentally changed the industry.

Incorporating insights from senior leaders across wealth management, life insurance, financial advice and consultancy, the study focuses on how AI is being used in real operational settings inside regulated firms, and where it is delivering value.

But although Aveni found universal interest in AI, financial firms’ uneven approach to the tech has led to a patchwork of maturity, with some still running pilot programmes and others already looking to embed proprietary models throughout their operations.

The report states that while many firms are seeing measurable productivity gains through early use cases such as quality assurance, documentation and workflow automation, scaling AI safely and sustainably continues to present significant challenges across the FS landscape. 

Governance, explainability, data quality, regulatory alignment and cultural readiness consistently emerged as the defining roadblocks to progress, though Aveni argues that finding solutions to these challenges may make UK firms uniquely placed to define global best practice.

Aveni said that progress will not come from isolated pilots or generic tools, but will depend on redesigning processes, building robust oversight frameworks and strengthening collaboration between firms, technology providers and regulators.

One particular area of focus was the adoption of agentic AI, with industry leaders viewing it as necessary since generic models are unable to handle the precision and regulatory burden of financial services work.

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As these advanced AIs can be trained on sector-specific data, rules and frameworks, many firms believe that agentic models can deliver better accuracy, clearer explanations and stronger alignment, or as one financial adviser put it, “spot trends quicker”.

But others voiced concerns that clients still “want to buy people” and are wary of machine-led advice, meaning firms should take a measured approach to adoption of the most cutting-edge models, with consumer trust being a critical prerequisite.

“Financial services has a unique responsibility when it comes to AI,” said Joseph Twigg, CEO at Aveni. “Trust, accountability and customer outcomes must sit at the centre of adoption. Our aim with this report is to provide a realistic benchmark for the industry, one that supports informed decision-making rather than fear-driven or hype-led implementation.”