Hart is firmly established as Roy Hodgson's first choice but Banks is concerned there is no-one currently pushing him for his place at either club or international level.
"Joe is the best English goalkeeper by a mile, no question, but what concerns me is that there is nobody challenging him for that position," said Banks, who won 73 England caps.
"I don't think he is the best in the world but the age he is (25), he stands a great chance of being the best.
"I don't want him to get too over-confident where he doesn't have to worry about his place. Nobody is pushing Joe Hart at all - he is not even being pushed by his club.
"Peter Shilton and Ray Clemence used to share the duties and they had Phil Parkes, Joe Corrigan and Peter Bonetti (challenging) and when I came through there was Ron Springett.
"You couldn't have a bad game and then say to yourself that you'd have to be in the squad because there is nobody else, you had to be on your toes.
"We currently have no strength in depth, none whatsoever and the reason is that with the Premier League you have foreign players taking the position of young home-grown lads.
"There are fewer and fewer players to pick from. We have got to find a method of bringing young goalkeepers through.
"If you are a goalkeeper your standards can't be raised (by playing alongside foreigners) because you have to be in the side to play. You are either in the team or you are not."