TL;DR

The FCA has opened applications for its second AI Live Testing cohort. Firms with mature AI proof of concepts can test in real market conditions with regulatory support and technical partnership from Advai. Applications close 2 March 2026, with testing starting in April.

Moving Beyond Perpetual Pilots

AI Live Testing targets firms stuck in what the FCA calls “POC paralysis” or “perpetual pilots”—products ready for market but lacking the confidence or regulatory clarity to deploy. The programme provides a structured space to test AI-driven services in real-world conditions.

The first cohort joined in October 2025. With the second application window now open, the FCA is inviting firms with mature proof of concepts ready for controlled market environments.

What Gets Tested

The FCA distinguishes between AI models and AI systems. Testing focuses at the enterprise level—the actual deployment context—rather than foundation models in isolation. This holistic approach covers the AI model itself, deployment context, core risks, governance arrangements, human-in-the-loop considerations, evaluation techniques and input/output controls.

Participating firms receive AI technical and regulatory support through three sequential phases: discovery, framework validation, and AI system testing with shared evaluation.

Benefits for Both Sides

For firms, participation offers clarity on regulatory expectations before full market deployment. The programme allows them to share challenges in interpreting and aligning with regulatory requirements—valuable feedback when moving from pilot to production.

For the FCA, the programme generates intelligence about what’s actually happening on the ground with AI deployments. “This helps us productively adapt and evolve in response to real industry behaviour, which is vital for any major technology shift,” the regulator noted.

Looking Forward

Applications remain open until 2 March 2026. Successful firms will be notified by mid-March, with testing beginning in April. For UK financial services firms ready to move AI applications from pilot to production, this offers a supported path through the regulatory landscape.