The Treasury Committee has announced that it will launch a new inquiry into the use of AI in banking, pensions, and other financial services.

MPs will investigate the potential impact of the heightened use of AI across financial services in the UK.

The move comes as recent Bank of England figures show that 75 per cent of firms are already using the technology, with a further 10 per cent planning to use it over the next three years.

The Committee said that the launch of DeepSeek, which was recently hit by a major cyber attack, highlights the “volatility and rapidly evolving nature” of the AI market.

As part of the inquiry, MPs may review the extent to which AI could jeopardise financial stability and question if there is the potential for increased cybersecurity risks.

Lawmakers said that their investigation could also explore how AI is currently used by City firms as well as what opportunities it brings for innovation in the financial services sector.

Alongside this, MPs could consider the potential impact on employment in the sector, asking how the UK compares to other countries in both its competitiveness and approach.

The Committee also says it wants to understand what safeguards may be needed to protect financial consumers, particularly vulnerable ones who may be at risk of bias.

“It’s critically important the City can capitalise on innovations in AI and continue to be a world leader in finance," said chair of the Treasury Committee, Dame Meg Hillier. "We must, though, also be mindful of ensuring there are adequate safeguards in place to mitigate the associated risks, particularly for customers. This piece of work will allow us to see the full picture.”

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