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UK financial services companies are embracing 'alternative data'

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(Image credit: Image Credit: Geralt / Pixabay)

Financial services companies in the UK are using an increasing number of alternative data sources when making key business decisions, a new report from Oxylabs suggests.

The proxy provider polled 252 senior data decision-makers from the country’s finance sector and found that 63 percent of respondents use “non-traditional” data sources that have not previously been analyzed.

These include web scraping and financial transactions (the two most commonly used sources), as well as app downloads and usage metrics, social media sentiment, website traffic statistics, search data, senior staff hirings, corporate flight activity, supply chain, and so on.

Although financial organizations still use “traditional” data sources, the old approach has been “superseded” by the rapid rise in alternative data, the report says.

Oxylabs believes alternative data can be used to better understand business performance, spot trends, as well as future investment opportunities, but businesses need to be able to transform this data into actionable insights. 

“The huge increase in online alternative data sources has instigated a sharp spike in demand for web scraping services from financial services firms looking to overcome the challenges of the pandemic,” said Julius Černiauskas, Chief Executive Officer at Oxylabs.

“At Oxylabs, we have experienced a threefold surge in inquiries from financial services firms over the last year, so we were keen to learn how exactly these organizations were approaching data gathering and analysis.”