Lumi raises $31.5m to help improve small-business lending
Company promises industry-leading approval times.
Australian fintech company and alternative lender Lumi has announced it has raised $31.5 million in Series A funding as part of its plans to give small- and medium-sized enterprises easier access to finance.
As a result of the funding, Lumi will become the first pre-revenue fintech business lender to offer a warehouse securitisation program in Australia. By combining its application programming interface (API) with traditional credit data and the applicant's social impact, Lumi aims to streamline the loan application process for small-business owners.
Yanir Yakutiel, founder and CEO of Lumi, says the company is trying to solve the key issues of alternative lending for small businesses. "We saw a real opportunity for Lumi to carve out a niche in the Australian small business space, particularly among hospitality, retail and professional services sectors, by building an innovative fintech platform that is solving the fundamental challenges in alternative lending: access and speed," he said.
With a majority of Australian SMEs citing a lack of time as their biggest business issue, Lumi's ability to provide industry-leading lending turnaround times could be valuable for small businesses struggling to get funding. "We have built the platform to ensure loan applications are seamless, fast and secure and we are able to extract the diamond in the rough from the businesses that banks often overlook with our comprehensive credit decisioning algorithm," Yakutiel said.
Businesses can apply for an unsecured loan from $5,000 to $100,00 if they have a valid ABN, annual turnover of more than $60,000 and have been operating for at least 6 months. With their data inputs, Lumi promises SMEs can avoid any time-consuming application process or paperwork and can be approved within an hour.
According to Yakutiel, access to capital can be provided for a variety of business needs. "We have the most sophisticated data universe in the country which makes Lumi a very attractive proposition and we've set up a securitisation program that will allow us to have different tranches and fund different grades of credit depending on the loan application we receive," Mr Yakutiel said.