AI in financial services in 2022

In April 2021, the European Commission published its draft regulation on AI, the first of its kind, with an aim to develop a bespoke regulatory framework on AI technology. The proposed regulation, if adopted in its current form, looks to introduce: a strict regime and mandatory requirements for "high-risk" AI, such as AI systems used to evaluate creditworthiness or establish credit scores; limited requirements for specific types of AI, such as chatbots; and a ban on certain uses of AI, such as AI systems that deploy subliminal techniques beyond a person's consciousness. The regulation will apply to users and providers of AI based in the EU. It will also regulate providers and users of AI systems that are established in a third country, where AI systems are located in the EU or to the extent the output produced by systems in a third country are used in the EU. The proposed regulation was open for consultation last year.