Luvleen Sidhu on founding and leading BM Technologies

As one of the leading figures in the American banking space, Luvleen Sidhu is President, CEO and Founder of BM Technologies, Inc.. The company is one of the largest digital banking platforms in the United States and provides access to checking and savings accounts, personal loans and credit cards. As a board member of BM Technologies (BMTX) and Director and Founder of the BankMobile Foundation, Sidhu identifies and funds budding entrepreneurs and organizations that promote financial literacy. We caught up with her to find out more.

Describe your role and background in fintech – is there a story there?

I started the first day of my career in 2008 at Lehman Brothers. Witnessing firsthand the fragility of the traditional financial landscape instilled in me a passion for using digital means to create a strong financial foundation for millions of Americans. Before founding BM Technologies (BMTX), I was a management consultant at Booz & Co. in their financial services practice and also worked as director of business development at Customers Bank.

I founded BMTX in 2015 with a mission to financially empower millions of Americans by providing a more affordable, seamless, and consumer-friendly banking experience. More so, I aspire to help Americans achieve financial stability, by engaging the millions of unbanked and underbanked individuals in the United States. Many of these people are locked out of the system by monthly fee requirements and have an inherent skepticism of traditional banks. By offering a low or no fee digital banking platform focused on technology and financial empowerment, we aim to provide an alternative. I believe in breaking the traditional mold and partnering with global brands and universities to distribute financial products that promote inclusivity and create wealth that empowers real people to live better lives.

What attracted you to the sector you have chosen?

The inspiration for BMTX came when I walked into a bank branch for the first time to open a checking account. I was amazed to find that this process took me 25 minutes. I didn’t understand why it was so difficult. The day before, I had booked a ticket online for Australia, on the other side of the world, and it had taken less than five minutes. I was shocked that this bank was so disconnected from the technology I took for granted. In an age where we can see almost any movie when we want to see it rather than heading to the video rental store or booking air travel and hotel stays right from our phones, why should banking be as difficult and impractical as it is? I decided to do something about it.

In addition to making banking services more accessible, this is the opportunity I saw in 2016 when I shifted the focus of BMTX to a B2B2C approach and started implementing the award-winning model Banking-as-a-Service (BaaS) from BMTX. BMTX was a pioneer before BaaS became the industry buzzword it is today. BMTX’s BaaS model is a proprietary API-driven platform and white-label interface through which it enables brands and FinTechs to expand access to digital banking products and launch financial services products entirely from brand at a fraction of the cost. This leads to attracting new customers, adding new revenue streams, and providing a more personalized experience for their customers.

In terms of diversity, do you find the fintech space to be a more inclusive environment than it was when you first entered?

There are many opportunities for women interested in finance and technology, but companies must also provide an inclusive environment for employees to thrive. According PwC Research, 85% of millennial women prefer to work for companies with strong employer policies on workforce diversity and inclusion. However, 71% of them say that even though companies talk about diversity, opportunities in the workplace are not equal. Opportunities for women have come a long way in the FinTech industry, but more needs to be done for full equality and economic parity.

What can the industry as a whole do to attract more women into finance?

When it comes to attracting more women into finance, it’s important to understand the needs of the modern woman. Providing flexibility in the form of hybrid work models is key to enabling women to balance work and personal responsibilities. According The Deloitte report on fostering more women leaders in financial services, there is no single path to achieving greater gender equity. However, organizations that prioritize and advance gender equity internally can position themselves to influence public policy, shape or reshape cultural norms, and differentiate themselves in their spheres of influence: their workforce, the market, and society. in general.

What advice would you give to your younger self if you had the chance?

I would tell him to take challenges and turn them into opportunities instead of letting them be a source of discouragement. Challenges helped me grow and therefore made me stronger and better prepared to face new opportunities.

Regarding your recent achievements, BMTX’s Q2 revenue was quite significant. Can you tell us about that?

We posted a quarter of record earnings in the second quarter of 2022, with $15.1 million in EBITDA, an increase from 8% last year despite the lack of stimulus from last year and macroeconomic environment this year.

In 2022, BMTX moved from execution of a term sheet to a signed contract to provide technology to a major new BaaS partner. This partner has global operations and tens of millions of customers in the United States. BMTX secured this relationship through a competitive bidding process, underscoring the competitiveness of its BaaS offering in the market. With the addition of this partner, BMTX has expanded its list of well-known major brand partners. This relationship may become even more valuable if BMTX can vertically integrate this new partnership with the addition of a charter bank, which it is doing with its pending acquisition of First Sound Bank.

The current economic climate is impacting the sector – what do you think are the biggest challenges facing banks?

Physical banks are facing increased competition with many disruptors and demand for greater personalization using technology. With heightened skepticism in banking systems as a whole in a challenging economic climate, the need for banks to adopt technology that meets consumer demand where they are is paramount to keeping the industry ahead of the game. advance on these challenges.

BaaS has so much to offer – what can we expect in terms of trends in the future?

BaaS continues to evolve at high speed. I think we will continue to see more and more uses of AI, blockchain and machine learning in BaaS and integrated finance. Moreover, according to a survey conducted by Trading Insider Information, nearly 80% of respondents who have used mobile banking say it is the primary way to access their accounts. This provides more opportunities for BaaS providers to be first movers in innovative services that will improve the banking customer experience.

What future for Luvleen Sidhu?

I look forward to continuing to drive strategic growth and innovation at BMTX. In November 2021, we announced the signing of a definitive merger agreement with First sound bank, a community bank based in Seattle, Washington. This is an exciting step for us and a big step forward in realizing our vision to create a disruptive FinTech bank. BMTX joins a few other innovative fintechs that have taken a similar step by combining a FinTech with a charter like Square, LendingClub, Varo, and SoFi. The transaction is subject to regulatory approvals and other customary closing conditions and is expected to close in the second half of 2022. As a public company, we continue to be customer-centric while also focusing on creating new products innovative digital banking and functionality within the following pillars: banking, lending, financial advisory, investment and insurance, and crypto.