Investment in financial technology is growing faster in Europe than any other region in the world, according to a report from the management consultancy Accenture.
Fintech investment in the continent increased 215% year-on-year in 2014 to total of more than ($1.5bn) £1bn, with the UK and Ireland netting about two-fifths of it between them, or $620m (£420m).
However, the US is still capturing more investment than Europe overall.
Julian Skan, Accenture managing director overseeing the FinTech Innovation Lab London, said: "The massive investment in fintech shows that the digital revolution is well advanced in financial services, and it is both a threat and an opportunity for banks.
"Fintech is empowering new competitors and start-ups to move into parts of the banking business but, paradoxically, it is also helping banks to create better, more convenient products and services for their clients.
"It is also leading to increased cooperation between traditional banks and innovative start-ups and technology businesses in a way that can result in totally new business models and revenue streams."
The report also revealed that three-quarters of senior banking executives feel the approach banks have to the sector is fragmented or opportunistic, while 40% believe the strategy is too slow.
There was also an appetite among the executives to improve the skills and culture in regards to technology, with 80% saying that working with start-ups was an effective way of bringing new ideas to the business.
"Banks are starting to realise the full potential of digital technologies and their potential to disrupt and transform the banking industry," said Richard Lumb, group chief executive, Financial Services, Accenture.
"The leaders recognise that digital goes far beyond channel and process innovation – it dissolves industry boundaries and provides opportunities for new business models and competitors, and banks have no choice other than to innovate to remain relevant to their customers."
