The finance sector must ensure artificial intelligence (AI) is used to support better decision-making while preserving the judgement, accountability and trust that underpin responsible lending. Technology can help us move faster, but speed is not the same as wisdom. AI may assist in reviewing complex information, but it should not remove the need for experienced people to interpret it.
Development finance has a direct impact on small and medium-sized enterprises (SMEs), contractors, families and communities. As AI adoption accelerates, lenders must ensure technology strengthens human judgement rather than replacing it. Responsible adoption requires lenders to maintain clear human oversight over material decisions, particularly where AI tools are used to support risk assessment, affordability checks or credit processes.
Research from Gartner found that 59% of finance leaders reported using AI within their finance functions in 2025, suggesting that for many organisations the debate has shifted from whether to adopt AI to how to adopt it responsibly.
Reflecting on themes raised in Magnifica Humanitas, AI should not be shaped by the few, for the few. A technology this powerful will affect work, finance, education, public services, communication and even democracy itself. It should not be controlled only by a small number of powerful companies, Governments or technologists. The conversation needs to include business leaders, regulators, policymakers, employees and communities. However, according to the UK Business Data Survey 2026, 17% of AI-using businesses reported having no AI policy or guidelines in place, suggesting governance frameworks are not always keeping pace with adoption.
There are three core principles when handling AI: transparent decision-making, clear human accountability, and open explanations for AI-assisted outcomes. Trust is central to lending. Borrowers may accept difficult decisions when they understand the reasoning. They are much less likely to trust a process that feels automated, impersonal or unexplained.
Distinction matters. Businesses that use AI simply to automate judgement may create efficiency in the short term but weaken trust and resilience over time. AI can enhance judgement, so it becomes faster, more consistent and more responsive while still preserving human responsibility at the heart of good decision-making. Borrowers should not be left facing black-box decisions that cannot be explained or challenged.
AI should support people, not reduce work to cost efficiency. It is important to preserve the human value of work, including purpose, identity and contribution. AI should not be viewed simply as a tool for cost reduction. Used well, it can remove repetitive work, improve consistency and give teams more time to focus on judgement, client relationships and better outcomes. It should help people do better, more meaningful and more valuable work.
There are six practical principles for lenders adopting AI. First, AI should be used with a clear purpose. Not every process needs automation. The best applications will be those that solve real problems for clients, colleagues or risk management.
Second, data quality matters. AI is only as useful as the information it is trained on and the assumptions built into it. Poor data produces poor decisions, even when presented with confidence. Third, human review must remain central for material decisions. Credit, conduct and client outcomes should not be delegated entirely to automated systems. Fourth, transparency is essential. Clients and colleagues should understand when AI is being used, what role it plays and where accountability sits. Fifth, governance must keep pace with adoption. Boards and senior leaders need to understand not just the opportunity, but also the operational, reputational, regulatory and ethical risks.
Finally, AI should be judged by whether it improves outcomes. Does it help clients? Does it improve risk management? Does it make decisions fairer, clearer and better informed? Does it strengthen the business without weakening human accountability?
These principles are essential to ensuring AI improves risk management, fairness and client experience while maintaining confidence in lending decisions.
Keeping people at the centre of finance matters. While AI will play an increasingly important role in shaping the future of finance, it must reinforce, not erode, the qualities that underpin responsible lending: judgement, accountability, fairness and trust. Technology can help us lend better. It should never make us forget why we lend in the first place.
Peter Wade is chairman of BLG Development Finance