Global non-cash volumes are projected to hit 426 billion in 2015, up from 387 billion in 2014, driven by strong economic growth in key developing countries, which saw digital payments up 16.7%, compared to six per cent for mature markets, although these still account for 70.9% of total volumes.

Other factors driving the move from cash include improved security measures such as EMV and biometrics, and government initiatives in places like India designed to encourage electronic payments. For the first time, China has surpassed the UK and South Korea in digital transaction volumes, taking fourth position among the top ten markets globally, behind the US, Eurozone and Brazil.

While digital payment volumes continue to grow at an impressive rate, the report highlights the challenges facing banks in the transaction banking market, where a host of factors - including lower fee income, lower interest income, pressure on FX service fees and the emergence of fintech rivals - is putting pressure on revenues.

Banks must adopt a "think digital" mindset to thrive in this environment, says Capgemini. Many already are, with 79% of executives surveyed for the report now viewing fintech firms as partners. And banks could have additional opportunities to further drive innovation in transaction banking by opening up their internal systems through.

Jean-Francois Denis, deputy global head, cash management, BNP Paribas, says: "While treasurers’ fundamental expectations have not changed over recent years - control, visibility on cash, risk management - corporates increasingly expect banks to digitalize support processes such as account management, data analytics, compliance tracking, and fraud detection and prevention. This calls for banks to accelerate their shift towards digitization and foster a more collaborative approach."