The hidden challenge facing banks

Maarten Wouters | Riser | Getty Images

There is a shadow looming over the world's retail banks, which many believe the market is not factoring in.

For much of the past few years, the focus has been on the fallout from the higher-stakes poker games played before the financial crisis. But now retail banks face the prospect of a significant shake-up, focused on their use of cutting-edge technology.

The need for "significant" renewal in banks' IT systems was recently highlighted in research by Deutsche Bank analysts. They have estimated that most of the big banks now need the kind of technological overhaul that would drive up costs by around 10 percent initially.

Revamped systems should eventually lead to more efficiently run banks, with a smaller high street presence, fewer staff in branches and lower costs. But an initial outlay will have to be made.

Whether or not they can get ahead of the pack will be a key determinant for the relative success of individual banks. And getting an edge comes on top of traditional worries about security – banks have to be fanatically paranoid about the protection of their customers' details.

(Read more: Bank fee could be pain in the app)

Payday loan company Wonga's results last week showed how digital strength can help profits. Three-quarters of a million people in the U.K. now have the company's app on their phone, and this ease of access has helped the lender gain market share – despite the controversy over the interest rates charged on some of its loans.

Larger, less nimble banks and credit card companies have yet to come up with an app which can establish market dominance. And the problem hasn't been helped by banks' wish for differentiation, making it difficult to develop a "one size fits all" app.

The Near Field Communication (NFC) system, used by digital wallet projects like Visa's V.me and Mastercard's Masterpass, doesn't seem to have taken off with consumers yet. Attendees at the recent IFA consumer electronics fair in Berlin whispered that Paypal still has the edge, despite the years poured into the NFC project. Perhaps tellingly, the executive in charge of the project within Visa recently moved to another role within the company.

It will be interesting to see whether any of the anticipated new iPhone designs launched on Tuesday are NFC-compatible. Apple has been more reluctant than rival Samsung to embrace the technology. A secure, trusted and easy-to-use iPhone app might make all the difference to the market.

(Read more: Why new iPhone launch won't disappoint)

As those trying to spearhead change are aware, the consequences for industries which don't embrace the digital age quickly enough can be dire. Ask anyone working in the music or "old media" industries.

Follow Catherine on Twitter: @cboylecnbc