The Financial Conduct Authority has launched a study into the use of algorithmically generated synthetic data and its potential for safely opening data sharing between firms, regulators and other public bodies.

The regulator has released a call for input from stakeholders to better understand different market participants views' on the extent to which synthetic data can expand data access and data sharing opportunities in an increasingly digital market

"Increasingly, innovation within financial services is data-driven, requiring large volumes of high-quality data to develop and train accurate, effective models and systems," says the wathdog. "However, financial data - such as consumer transaction records, account payments, or trading data - is sensitive personal data subject to data protection obligations, as well as often being commercially sensitive. This is where we believe synthetic data can help."

The study will also evaluate the maturity of synthetic data usage within financial services, and the extent to which both regulated and unregulated firms are using it.

The FCA is additionally interested in what the industry sees as the role of the regulator and the appetite of firms to collaborate with regulators and/or other organisations to generate synthetic data.