In a recent study, Fintech in Australia – Trends, Forecasts and Analysis 2015–2020, research firm Frost & Sullivan says the Australian fintech sector is poised to take $10 billion in aggregated revenues away from the big Australian banks, while contributing $3 billion of new revenue to the Australian financial services sector, by 2020. The firm contends that the big four banks in particular must react, or “face a large dent in future profit growth.”

But as Saranga Sudarshan, Frost & Sullivan research analyst points out, the banks are not just incumbents waiting to be picked off – they have agency, they have scale and they have the financial muscle to buy the fintechs they see as threats or whose product they like. “We see the banks as having two strategies. There is the Westpac model, a kind of engagement model, they have invested heavily in fintechs – in a $100 million investment fund they have already invested half of that.