The use of AI is increasingly widespread in the Italian financial sector, with experimentation and adoption growing fast, particularly in Generative AI. The benefits span many different types of activity within the sector. However, a range of regulatory and non-regulatory constraints may hinder broader AI adoption. Drawing in part on an OECD survey on AI innovation in the Italian financial sector, this report analyses the current landscape and outlines policy considerations aimed at fostering the safe and responsible development and deployment of AI, in accordance with the European regulatory framework.