The financial services sector is entering a period of profound change driven by artificial intelligence and other disruptive technologies. As this transformation accelerates, the sector will need to adapt quickly to capture opportunities for growth, or risk falling behind, according to new HM Treasury-commissioned report.
The report, ‘A Workforce Transformed,’ notes that the potential growth benefits of artificial intelligence have long been recognised, and such technology is already being deployed across the industry to drive improvements in productivity, customer outcomes and innovation. However, it also finds that as adoption scales, the impact of AI on how people work will be significant, and has possibly been understated.
Research in the report suggests that up to 50% of tasks, in most financial services roles, could be automated. This is particularly the case as use of more advanced tools, such as agentic AI, continues to grow. AI will reshape how work is carried out, with tasks changing across most roles, but human expertise will continue to be critically important.
The report is published by the Financial Services Skills Commission, which is carrying out HM Treasury-backed research into the impact of AI and disruptive technology on the sector's workforce. Announced in the government’s Financial Services Growth and Competitiveness Strategy, the research has been carried out with the support of Lloyds Banking Group, PwC, City of London Corporation and TheCityUK.
The findings suggest that the trend towards a highly skilled sector will continue to accelerate. Amidst these changes, the sector will need to recruit and train 450,000 highly skilled people over the next 10 years to replace those who are likely to retire or leave, reinforcing the need to invest at scale in both new talent, and the upskilling and reskilling of the existing workforce.
While these technologies present major opportunities for productivity and growth, they also raise important questions about how work will evolve and how prepared the financial services sector is to navigate this change, and realise the benefits on offer
This first report sets out how AI and other disruptive technologies are reshaping roles, tasks and skills across the sector. A second phase will follow, focused on developing practical recommendations for firms, government and the wider skills system. The final report is expected by early 2027.
The Financial Services Skills Commission is also working with HM Treasury and Skills England on the creation of a ‘Skills Compact.’ The Skills Compact is a commitment by signatory firms to work together to close skills gaps in UK financial services. Signatories are demonstrating leadership by committing to invest in their people, maintain the future talent pipeline and collaborate to close the sector’s skills gaps. The Skills Compact is due to launch in summer 2026.
Claire Tunley, Chief Executive of the Financial Services Skills Commission, said:
“Artificial intelligence and other disruptive technologies are ushering in a period of profound change for financial services. While the opportunities for innovation and growth are clear, realising them will depend on strong leadership, robust governance, high-quality data, continued focus on customer outcomes and, crucially, prioritisation of skills. AI is already being deployed across the sector, with human expertise vital to overseeing and challenging its outputs.
“Our research shows that up to half of the tasks, within most roles, could be automated by AI, meaning that skills priorities will shift towards a blend of technical skills, behaviours and sector-specific expertise, underpinned by continuous learning. This report, informed by extensive industry engagement, sets out how roles and skills are changing and highlights the collective action needed to ensure the UK remains a world-leading financial centre in the age of AI.”
Sharon Doherty, Chief People and Places Officer, Lloyds Banking Group, said:
“Artificial intelligence is already transforming how financial services are delivered, creating significant opportunities to improve productivity, enhance customer outcomes and develop new products and services.
“At Lloyds Banking Group, we are building on long-standing investment in AI and data, with a clear focus on equipping colleagues with the skills they need and preparing for how roles and skills will continue to evolve.
“This report is an important contribution to how the sector builds a future ready workforce and ensures the UK remains globally competitive.”
Sapna Patel, Financial Services Partner, PwC UK, said:
“AI will drive growth in financial services, but only if the sector has the skills to harness it. As automation reshapes roles and redesigns work, demand is growing for people who can combine technical expertise with critical thinking and deep sector knowledge. This creates both opportunities and challenges for the workforce, particularly for early-career talent, requiring organisations to rethink how people enter and develop within the sector. No single organisation can solve this alone – it will require a coordinated effort across the wider ecosystem to equip the next generation with the skills needed for the future of financial services.”
Chris Hayward, Policy Chairman of the City of London Corporation, said:
“AI and other disruptive technologies are reshaping the foundations of financial services, with profound implications for productivity, competitiveness and the UK’s long-term growth.
“This report highlights that the pace of change now demands a coordinated response, bringing together industry, government and education to ensure the right systems, governance and infrastructure are in place to support responsible and effective adoption. AI must augment human capability, not replace it.
“By acting decisively, we can ensure the UK remains a world-leading financial centre, able to harness these technologies in a way that drives growth, maintains trust, and delivers strong outcomes for customers.”
Miles Celic, OBE, Chief Executive Officer, TheCityUK, said:
“AI and technology are reshaping financial and related professional services at breakneck pace. With skills and talent sitting at the heart of the UK’s continued competitiveness as an international financial centre it is essential that attention and investment is prioritised to build a workforce for the future. This report provides the foundational analysis for why and how the industry must evolve its approach to skills and talent. To make the progress needed, it’s clear that coordinated action between industry, government and the skills system will be vital. We look forward to continuing our work with the Financial Services Skills Commission to move this important agenda forward. “
