Traditional high street banks offering online finance and insurance services are seen as the biggest threat to financial organisations rather than new entrants, such as Virgin and Tesco, a new report says.

A third of all respondents in the poll, conducted by CMG Admiral, part of global information and communications group CMG, and E-collaboration, believed new entrants were a potential risk to them. However, half said high street competitors offering online services were the biggest threat.

CMG Admiral management consultant Anthony Chrumka said: “If a well known brand is supplying services on the net, many consumers will opt for it due to the ease and comfort factor, in preference to new virtual banks. The internet is fast becoming the crucial battleground for market share.”

He added: “The stumbling block for many companies is how to integrate the front of the website with the back-end. Many of these sites are all smoke and mirrors, and therefore cannot offer the best services to customers.”