The Financial Conduct Authority has extended the deadline for applications to its second cohort of AI live testing to 24 March.
The regulator opened applications in January, with participating firms set to start testing in April.
The project is designed to help the regulator better understand how AI could shape UK financial markets and inform its future approach to AI technology.
The AI live testing is running alongside the FCA’s Supercharged Sandbox, which helps firms who are in the experimental phase with their use of AI.
For the testing, the FCA has partnered with Advai, a UK-based company specialising in automated testing, evaluation and assurance of AI systems, providing independent technical evidence.
In the first phase of testing, the firms to take part were Gain Credit, Homeprotect, Natwest, Monzo, Santander, Scottish Widows and Snorkl.
The majority of the AI applications being tested by the project so far have focused on retail financial services including use cases to harness AI to support debt resolution or provide financial advice.
Applications are also exploring the potential for AI to help improve customer engagement, streamline complaints handling and help consumers to make smarter spending and saving decisions.
The FCA said the testing is helping firms to address key questions around evaluation frameworks, live monitoring governance and risk management to ensure that AI is deployed safely and responsibly for consumers and markets.
According to a recent report from NextWealth, 8 out of 10 financial advice firms see compliance and regulation, and a lack of a structured due diligence framework, as barriers to AI adoption.
In February the FCA launched a major review into how AI could change retail financial markets, regulators, and consumers.
The review will examine the implications of AI as it rapidly advances and will build upon the work the regulator has done on AI, including the AI Discussion Paper, AI Sprint, and AI Lab.