How finance regulators are writing AI rules
How are financial regulators turning high-level AI principles into enforceable controls?
Financial regulators started with principles and sandboxes, but by 2026 India and Singapore were writing concrete expectations on inventories, model validation, vendor accountability and kill switches, and the US Treasury had issued a voluntary framework for finance. Singapore issued final guidelines in October 2026. In India a principles report has been followed by draft model-risk rules and promised SEBI controls.
KeyStoryRule or law
- MAS issues final AI risk management guidelines for Singapore’s financial institutions
Singapore turns its proposal into final guidelines, in effect from October 2027.
- SEBI chief says AI/ML rules will mandate kill switches and human oversight
SEBI signals mandatory kill switches and human oversight for AI in markets.
- RBI drafts model risk rules covering AI/ML for all regulated lenders
The RBI drafts model-risk rules covering third-party and AI/ML models.
- FSB consults on 12 sound practices for how financial institutions adopt AI
The FSB offers twelve practices that national supervisors can cite, finalised in October.
- FCA names Barclays, UBS, Experian and others in second AI Live Testing cohort
The UK tests AI, including agentic payments, live with firms before setting expectations.
- US Treasury releases AI lexicon and finance-specific AI risk framework
The US opts for a voluntary finance-specific version of the NIST AI RMF instead of binding rules.
- MAS consults on AI risk management guidelines for all financial institutions
Singapore proposes inventories, risk materiality ratings and lifecycle controls, including for AI agents.
- Rule, In forceIndiaRBI FREE-AI Framework
FREE-AI’s 7 sutras and 26 recommendations set India’s baseline for AI in finance.
- RBI publishes FREE-AI framework for AI in India’s financial sector
The RBI publishes the framework and begins turning its principles into supervision.
- Rule, In forceIndiaSEBI Reg 16C (AI responsibility)
SEBI already makes intermediaries liable for the AI tools they use.
- RBI sets up committee to draft a responsible AI framework for Indian finance
The RBI set up the committee that wrote the FREE-AI framework in December 2024.
- SEC proposes conflict rules for brokers and advisers using predictive data analytics
The SEC proposed rules on brokers’ and advisers’ use of predictive analytics in 2023.
Related developments
Connected developments not on this line
- DevelopmentFSB chair Bailey warns G20 of frontier AI risks: cyber first, then valuations31 Aug 2026, Statement, International, United Kingdom
- DevelopmentVisa expands Agentic Ready agent-payment testing to Asia Pacific and Latin America29 Apr 2026, Launch, International
- DevelopmentSEBI consults on rules for AI and machine learning in securities markets20 Jun 2025, Policy, India
- DevelopmentUS Treasury reports on AI in financial services after 103 comment letters19 Dec 2024, Report, United States
- DevelopmentMAS publishes good practices for AI model risk management at banks5 Dec 2024, Report, Singapore
- DevelopmentMAS and banks publish a generative AI risk framework from Project MindForge15 Nov 2023, Programme, Singapore