# DSIT/DBT strategic letters to regulators (Jan 2026): How will regulators enable safe AI-powered innovation: joint letter from DSIT Secretary of State and DBT Secretary of State

Source: https://www.bankingnewsai.com/ai-regulation/documents/gov-uk-dsit-dbt-safe-ai-innovation-letter-2026
Last updated: Aug 26, 2026

On 28 January 2026 Liz Kendall (DSIT) and Peter Kyle (DBT), with relevant departmental Secretaries of State including the Chancellor, wrote to 19 regulators — including the FCA, Bank of England and PRA — asking each to publish by May 2026 a plan for enabling safe AI-powered innovation in its sector and to report annually on actions, outcomes and metrics. Plans were to clarify how existing obligations apply to AI use cases, make approval processes compatible with dynamic AI products, use sandboxes, and consider making anonymised or synthetic datasets available.

## At a glance

| Field | Value |
| --- | --- |
| Authority | [UK (BoE / PRA / FCA)](https://www.bankingnewsai.com/ai-regulation/uk) |
| Type | Letter |
| Status | Final |
| Published | Jan 28, 2026 |
| Applies to | 19 UK regulators including the FCA, Bank of England and PRA (indirectly, all firms they regulate) |
| Official text | https://www.gov.uk/government/publications/how-will-regulators-enable-safe-ai-powered-innovation-joint-letter-from-dsit-secretary-of-state-and-dbt-secretary-of-state |

## Key points

- Sent 28 January 2026 to 19 regulators; financial services regulators were asked to work with HM Treasury and DSIT.
- Asks for a published plan in the first half of 2026 and annual reporting on how regulation enables AI-driven innovation and growth.
- Plans should clarify how existing obligations apply to AI, ensure approvals fit dynamic AI products, and act proportionately and transparently.
- Encourages sandboxes and access to significant anonymised or synthetic datasets.
- The BoE and PRA replied on 1 April 2026; the FCA's approach is reflected in its 2026/27 work programme and AI Lab initiatives.
- Part of the government's growth agenda; complemented by HM Treasury's Financial Services AI Adoption Plan of 14 July 2026.

## What changed for banks

The letters put political weight behind a pro-adoption stance. UK financial regulators are now accountable to ministers for removing barriers to AI, which explains the emphasis on sandboxes and live testing rather than new guardrails, even as the Treasury Committee pushes the other way.

## Use cases it governs

- [AI governance (general)](https://www.bankingnewsai.com/ai-regulation/by-use-case#governance-general)

## FAQ

### What did the UK government ask financial regulators to do on AI in 2026?

Publish a plan by May 2026 for enabling safe AI-powered innovation, clarify how existing rules apply to AI, use sandboxes, and report annually on outcomes.

## Related documents

- [Bailey: Frontier AI and the Question of Governance (Sep 2026)](https://www.bankingnewsai.com/ai-regulation/documents/boe-bailey-frontier-ai-governance-2026) — Frontier AI and the Question of Governance — Governor Andrew Bailey (Sep 30, 2026)
- [FCA multi-firm review: Frontier AI and cyber resilience (Sep 2026)](https://www.bankingnewsai.com/ai-regulation/documents/fca-frontier-ai-cyber-resilience-2026) — Frontier AI and Cyber Resilience (Sep 2, 2026)
- [HM Treasury Financial Services AI Adoption Plan (Jul 2026)](https://www.bankingnewsai.com/ai-regulation/documents/hmt-financial-services-ai-adoption-plan-2026) — Financial Services AI Adoption Plan (Jul 14, 2026)
- [2026 BoE/FCA AI survey](https://www.bankingnewsai.com/ai-regulation/documents/uk-ai-in-financial-services-survey-2026) — The Bank of England and FCA's 2026 AI Survey (Jun 5, 2026)
- [BoE/FCA/HMT joint statement on frontier AI and cyber resilience (May 2026)](https://www.bankingnewsai.com/ai-regulation/documents/uk-joint-statement-frontier-ai-cyber-resilience-2026) — The Bank, FCA and HM Treasury joint statement on Frontier AI models and cyber resilience (May 15, 2026)
- [BoE response to Treasury Committee AI inquiry (Apr 2026)](https://www.bankingnewsai.com/ai-regulation/documents/boe-pra-response-tsc-ai-inquiry-2026) — Response to TSC inquiry report on AI in financial services (Apr 1, 2026)
- [BoE/PRA plan for safe AI innovation (Apr 2026)](https://www.bankingnewsai.com/ai-regulation/documents/boe-pra-safe-ai-innovation-plan-letter-2026) — Letter from Sarah Breeden and Sam Woods to the Chancellor and Secretaries of State on enabling safe AI innovation (Apr 1, 2026)
- [PRA AI/ML model-risk roundtable (Nov 2025)](https://www.bankingnewsai.com/ai-regulation/documents/pra-mrm-roundtable-ai-ml-2025) — The PRA holds model risk management roundtable on artificial intelligence and machine learning technologies (Nov 24, 2025)

Last reviewed Aug 26, 2026. Cite the official text (https://www.gov.uk/government/publications/how-will-regulators-enable-safe-ai-powered-innovation-joint-letter-from-dsit-secretary-of-state-and-dbt-secretary-of-state) for the rule and this page for the summary and dates.

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