The United Kingdom is leading artificial intelligence (AI) investment in Europe placing it ahead of its closest competitors, according to a new report by the Corporation supported by EY.
In the UK, private capital investment was £3 billion in 2022, with UK AI scale-ups securing nearly double the funding compared to France, Germany, and the rest of Europe combined.
The new report, AI: Accelerating Innovation, How AI is Turbo Charging UK Financial and Professional Services, underpins the sector’s position at the vanguard of investing and adopting AI technologies to boost productivity, develop products and improve customer experience.
The continuous trend of digitisation in insurance and business services has been a facilitator of AI growth, with financial and legal services seeing adoption rates of 26% and 30%, respectively, while some 90% of banks already dedicate some resources to Generative AI initiatives and machine learning applications.
AI: Accelerating Innovation, launched today [30 October] at the AI for Innovation Dinner hosted by the Department for Science, Innovation and Technology and the City Corporation, urges that the successful adoption of AI must be coupled with an adequate governance framework to address the risks of AI, in addition to having a strong skills base and a culture that is keen to maximise the benefits of this cutting edge technology. The report highlights improving the UK’s short-term business mobility visas as a means of opening the door to international talent skilled in AI technologies.
The report also calls for international regulatory cohesion and alignment to support safe AI use not just in the UK but across the world. With the inherent cross-border nature of the digital economy and technology such as AI, this coordination is integral to sustainable success.
AI has the power to unlock significant opportunities for the UK to become more efficient and competitive by driving innovation and growth across all aspects of the UK workforce. UK organisations are already harnessing the benefits of AI with around one in six UK organisations, totalling 432,000, embracing at least one AI technology.
Chris Hayward, the Policy Chairman of the Corporation, said:
“The UK financial services industry is world-leading and globally respected. But as it continues to face competition from other markets around the world, the City Corporation recognises that harnessing the innovative power of AI will enable the nation to futureproof its competitiveness and ensure its long-term success. Also critical to this investment, will be clear regulatory expectations on how firms can safely adopt and scale AI.
“It’s paramount that the UK ecosystem can continue reforming its capital markets and pensions system to better enable institutional investment into FPS tech to the benefit of savers and growing the economy.”
Secretary of State for the Department of Science, Innovation and Technology, Michelle Donelan said:
“As these findings show, we have firmly positioned ourselves at the forefront of AI investment in Europe – bringing billions into our economy.
“We have a proud history of fostering innovation, particularly in financial and professional services, and finding the right balance through our pro-innovation approach to AI regulation which is why businesses want to make the UK their home.
“As we engage with sectors across the economy on the immense potential opportunities of AI, it’s crucial we also understand the risks so we can safely make the most of the opportunities it presents – which is precisely what the upcoming AI Safety Summit will address. Let’s seize this pivotal moment to strengthen our leadership in AI, ensuring a sustainable and prosperous future for not just the UK, but everyone across the globe.”
Axe Ali, EMEIA Financial Services Private Equity & Venture Capital Leader at EY said:
“AI has a profound impact on both businesses and individuals, and the Financial and Professional Services sector has been a key driver of the UK’s AI evolution to date; supporting innovation and the acceleration of new solutions in the market.
“Innovation is vital to shaping the UK as a globally competitive market long-term, and it will take a collective approach to ensure the momentum behind positive AI adoption and innovation continues to be fuelled. Further development of AI should factor in wider ecosystem enablers such as digital upskilling, supporting investment, and guidance for organisations on consumer protection, balanced with appropriate regulatory considerations.”
ENDS
Notes to editors
To read AI: Accelerating Innovation, How AI is Turbo Charging UK Financial and Professional Services, visit: https://www.theglobalcity.uk/insights/ai-accelerating-innovation
The Corporation is the governing body of the Square Mile dedicated to a vibrant and thriving City, supporting a diverse and sustainable London within a globally-successful UK.
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