Information technology is having an impact on virtually every industry. It has already transformed the retail landscape, and it is increasingly shaping other sectors, including banking.
The lines between finance and IT are becoming progressively blurred, and for banks this means keeping up with advances in technology in order to remain competitive in a world where consumers demand the latest hi-tech products and services.
It's a demand that digital businesses are only too happy to meet, and this is creating new competitive threats for banks beyond their traditional rivals.
Banks worldwide are being affected by the growth of digital challengers, but as global financial services provider Macquarie Group has pointed out, it is an issue that is particularly impacting on the Australian banking industry.
The organisation has warned that competition from digital rivals could lead to huge losses for Australian banks in the years to come, unless they can fight back by upgrading their own IT systems and developing their own digital offerings.
This could obviously open up some very exciting opportunities for IT professionals within the Australian banking industry as the major players look for ways to prove their technological worth and give consumers what they want.
The digital disruptors
According to ABC News, the Macquarie Group believes Australian banks could lose almost 30 per cent of their revenue to a new generation of digital businesses intent on encroaching on certain areas of banking by providing alternative services.
These businesses are referred to as digital disruptors, and they are predominantly targeting the $9 billion payments industry. PayPal is one of them, although there are many, many more.
So what exactly are they doing? Well they are exploiting the boom in smartphone ownership and the subsequent growth of mobile transactions, and they developing wallet systems that allow consumers to make payments using apps on mobile devices rather than credit or debit cards.
It is not the first time this threat has come to light. Last summer Ian Narev, the chief executive of the Commonwealth Bank of Australia, warned of growing competition from digital businesses, noting that payments is a big area of focus for them.
Speaking at the Group of 100 national congress, he noted that the likes of Apple, Google and Samsung are increasingly picking "particular slivers" of financial services and developing rival digital offerings, and said it is something that traditional banks need to be prepared for.
So are they in a position to head off these rivals? Klas Back, senior executive of the digital payments company Braintree, believes it will be an uphill struggle for the banks.
"Even to us who very much work in the technology space on a day-to-day basis, it changes so quickly," he told the AFP news agency. "Especially around mobile, you have almost an explosive shift in consumer behaviour in terms of how people are using mobile devices.
"I can only imagine how it feels for the banks who are a little bit more structured around their legacy systems and more about risk management and less about technology and innovation and change."
How can banks fight back?
Macquarie has warned of the threat from digital payment providers, and heading off competition in this area will be a major priority for Australian banks. But this is not the only digital competition they face, and as technology advances, rivals will emerge in other areas too.
Indeed, tech-savvy consumers - particularly younger consumers - are demanding a whole range of digital services not limited to payments, which means banks need to put digital offerings at the heart of their future strategies.
That's not to say that Australia's banks are sitting back and doing nothing. Some are already taking steps to digitalise their products and services, starting unsurprisingly with mobile payments.
All of the country's big four banks have invested in mobile payment systems that utilise NFC technology, making contactless payment cards available for their customers, while Commonwealth Bank of Australia account holders can withdraw cash using codes sent to their phones.
But there is much more to do if banks are to ward off the digital disruptors, and it will require huge investments in IT infrastructure, software and expertise.
According to ABC, Macquarie believes there will be an "IT arms race" over the next four years, with major Australian banks spending between $500 million and $3 billion more on technology to upgrade their core banking systems and meet these digital challenges.
Opportunities for IT professionals
If Macquarie's prediction is indeed true, it won't just be physical technology that banks spend their money on. They will need talented IT professionals to drive their digital activities forward, and this could create some very exciting opportunities for those with the necessary skills.
IT contractors may find themselves required for one-off projects, but there could also be a strong demand for permanent in-house staff as banks look to expand their IT teams.
As technology and finance become even more entwined, and as digital rivals begin to move into other areas of banking, the need for banks to have their own digital expertise will grow and we could see entirely new roles begin to emerge within the industry.
Add to this the fact that Australian consumers are becoming increasingly tech-hungry, and the country's banking industry could be a very interesting one for IT professionals to watch.