External forces from demographic, social, economic and regulatory phenomena have contributed to one of biggest revolution in the banking world: the emergence of challenger banks. Digitally-focused challengers such as Atom, Fidor Bank, Mondo and Starling, have grown significantly in 2015 and 2016, fueled by changing customer expectations, the new Generation Z, the heavy smartphone use in accessing finance and emerging technologies. Most of the innovation around fintech and challenger banks have occurred in regional hubs and heavily supportive countries and environments, according to a new report by Burnmark, including the UK and the US.

“The UK holds the first mover advantage as a home for challenger banks, but new geographies are gaining ground with support from government, regulators, investors and entrepreneurs,” the report says.

“The US, Singapore and Australia, in particular, are actively competing to create best-in-class financial innovation ecosystems and are increasingly progressive in their use of government and regulatory policy to support challenger banks.”