The vast majority of retail banks around the world have increased their investments in disruptive technologies this year as they seek to fend off a surge of new technology, telco and fintech competitors, according to research from Infosys Finacle and Efma.
Nearly three quarters of more than 100 retail banks quizzed for the 'innovation in retail banking' report regard the threat from technology companies, start-ups, retailers and telecom players as high or very high.
With this in mind, some 84% of respondents have increased their investments in disruptive technologies and innovative services this year, as they seek to deal with the surge in new industry competitors.
However, banks do not see new entrants as only a threat. More than two thirds of those quizzed believe that start-ups will have a high or very high impact on innovation and can help them to develop more innovative offerings.
There are barriers to working with startup challengers and partners, with 60% of banks "not upbeat" about the prospect, because of concerns over regulation and security.
After the all-important mobile channel, the most important new technologies for banks are advanced analytics and big data, where 57% expect the impact to be high or very high. This is followed by open APIs (53%), and the Internet of Things (47%).
Patrick Desmarès, secretary general, Efma, says: "This year's global retail banking study demonstrates that banks are eager to innovate, develop formal innovation practices, and increase their involvement with start-ups. This is a step in the right direction, but retail banks must be confident about the value of their start-up investments in order to collaborate with start-ups."