Lumi Review 2022

  • Updated: 15/01/2022
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🗺️ ProductsBusiness Term Loans
Business Line Of Credit
💰Funding Amount$5,000 to $500,000
📊 Loan Terms3 to 36 Months (term loan)
24 months (credit lines)
Min. Trading Period6 Months
Min. Trading Turnover$5,000 p.m
🛍️ Unsecured/Secured Unsecured if under $300,000
💳 Funding SpeedApproval Outcome in 2 hours
Same day loan is approved
lumi logo with words lumi review under it

Australian owned Lumi offers two types of finance, these are business loans and lines of credit. Funding can be between $5,000 and $500,000 and can be secured or unsecured. With approval in as little as two hours, Lumi promises one of the fastest approval times of the online lenders, making them a great option if you need capital fast.

Loan ProductsSmall Business LoansBusiness Line of Credit
Loan Terms & Funding Size
💰 Loan Amount$5,000 - $500,000$2,000 - $500,000
⏳ Loan Length3 - 36 monthsup to 24 months
(12 months per line)
📆Payment scheduleWeekly (Pay same each week) with option for 4 week holiday (no-interest)Weekly (Principal and interest)
💳 Line of Credit Option?✔️
Loan Costs
💸Fees (exc. interest)2.5% Establishment fee$25 for each drawdown
$30 monthly subscription fee
﹪Interest Rate TypeSimple interest rate 9% to 24% p.a.Fixed interest calculated daily (Principal + interest).
Only pay interest on drawdown
🔓 Unsecured Loans?✔️ (up to $300,000)✔️(can be secured or unsecured)
👍 Early Repayment✔️ ✔️
Loan Qualification
🎓 Qualification BasicsABN or ACN
Driver licence or Passport
Over 18
Australian Citizen
Permanent resident
🛍️ Min. Trading QualificationMin. 6 MonthsMin. 6 Months
📅 Min. Turnover QualificationMin. $5,000 per month$5,000 per month
🗎 Low Doc Loans✔️(Up to $150,000)✔️(Up to $150,000)
😕 Bad Credit ok?✔️ min. credit score 350✔️ min. credit score 350
Approval & Funding Speed
🏍 Fast Online Application✔️(Approval outcome within 2 hours)✔️(Approval outcome within 2 hours)
💨 Funding SpeedSame day loan is approvedSame day loan is approved

Products – Types of financing available

Lumi offers two types of loans for different business needs, these are:

  1. Small business loans
  2. Line of credit

Both types of loans as available as unsecured business loans, however you have the option of backing the loan with security. Doing this may lead to better interest rates or a longer loan term,

Types of Loans with Lumi - Small Business Loan and Line Of Credit

While these small business loans and line of credit form Lumi core products, other products may also be available. These include:

  • Short Term business loans
  • Long Term business loans
  • Startup Loans
  • Aboriginal and Indigenous Business Loans
  • Professional Business Loans
  • Hospitality Business Loans

This review does not cover these loans

Qualification for these loans will be the same as their small business loan, what will differ is the loan terms and funding they will provide. A long-term loan, for example, will have a longer repayment period, while a start-up or professional business loan may have a larger loan amount.

Small Business Loans

Lumi has a focus on keeping their business loans straightforward and easy to understand. Loans range from $5,000 to $500,000 and their repayment is between 3 to 36 months.

With funding provided on the same day for successful applications and no hidden costs – loans with Lumi are as simple as they come.

Lumi small business loans quick overview

Lumi Small Business Loan Qualification:

Lumi finance small business loan eligibility

To be eligible for a business loan, you need to have an Australian registered business that is producing a minimum annual turnover of $50,000 per year and has been in operation for at least 6 months.

These minimum requirements are similar to what most SME lenders will require, however, some lenders offer larger loans without security. Other lenders may be more strict with business credit score and credit history, while Lumi doesn’t advise a minimum credit score, they accept low credit applications.

Lumi can consider borrowers with bad credit as they use “big data” to establish multiple funding tranches so they can fund different grades of credit. Lumi claims to be the first Fintech lender to create a warehouse securitisation program in Australia, which allows them to find the data to justify giving loans that major banks won’t give.

If your business does have bad credit, your business will need a business score of at least 350 and to show good financial health, stable monthly revenue. Other factors considered include the years your business has been trading and the industry your business operated in.

Lumi Small Business Loan Funding and Loan Terms

Lumi finance business loan funding terms

Lumi says most clients will pay their business loan off in 6 months, which suggests most loans are not of significant size. Fastbusinessloans tested the online application process and the amount you can borrow appears to be consistent with a month’s worth of revenue. This lending amount is a basic industry standard.

Loans can be up to $500,000 with a term period as long as 36 months. Payment for your loan is on a weekly basis and will the same throughout the loan.

If you require larger or longer loans, then speak with a Lumi consultant and they will work with you to find a loan that suits your needs. The amount Lumi will lend you will depend on the business credit and trading history, and if you have any collateral.

Business Loans Loans up to $300,000 are unsecured. This means you do not need to provide collateral to get the loan. Loans above $300,000 will require security and this can be property, vehicles, inventory, and even unpaid invoices while loans below $300,000 may require security in certain circumstances.

Lumi Small Business Loan Costs And Fees

Lumi finance small business loan costs

As most clients will pay their loan within 6 months, Lumi doesn’t use interest rates, instead, they provide the entire repayment schedule upfront.

By using a factor rate, payments for each period is fixed, which means you will know exactly how much you need to pay each week and this amount will always be the same. This means you can plan your payments in advance and not need to concern yourself with changing payments because of variable interest rates.

Besides the factor rate, you will also need to pay an establishment fee of 2.5%. This fee covers processing and administration costs, Lumi’s origination fee is consistent with what most other lenders charge, as 2 to 3% is common in the industry.

The only other fee to be aware of is an early repayment fee. As the loan is fixed, Lumi offers a discount on the outstanding amount. This is normal practice for fixed loans, if you wish to avoid costs of early repayment, then you should consider a lender that uses interest rates.

Lumi is very transparent with their pricing, they are a founding member of Australian Finance Industry Associations (AFIA) Online Small Business Code of Lending. This means they have an obligation to uphold the standards set by AFIA’s charter.

As part of this charter, Lumi provides SMART Box™ pricing disclosure documents, these documents allow you to understand all the costs you will incur with the loan. It allows you easily to compare pricing with other lenders that also provide SMART Box™ disclosure documents. As the SMART Box™ displays all your costs, you can be confident the loan contract you sign is accurate and has no hidden costs.

No guesswork, no hassles, no reading between the lines. Just totally transparent loans to help you get ahead.

Lumi Business Line Of Credit

A business line of credit may be a better option than a business loan if you wish to control the amount you borrow. With this type of finance, Lumi gives you access to a credit facility of up to $500,000, which you can draw from any time.

The advantage of a credit line over a loan is that you only pay interest on funds you drawdown. This can save costs compared to a business line, which is a lump sum loan with interest charges from the commencement.

A line of credit can therefore be best if you don’t know when and how much funding you will need. A business loan is best when you know exactly how much you will need.

Lumi business line of credit quick overview

Lumi Business Line Of Credit Qualification:

Lumi finance line credit qualification

Qualification for a line of credit differs slightly when compared to a business loan.  Your business will need to have been in business for at least one year and have $5,000 in monthly turnover.

Lumi Business Line Of Credit Funding And Loan Terms

Lumi finance line credit funding terms

The size and terms of a line of credit differ from a business loan but offer greater flexibility. The credit line can be up to $500,000 however you can make a series of smaller drawdowns as long as the amount you draw from the credit line does not exceed the amount approved for borrowing.

Lumi offers a revolving credit line, which means you can reuse the capital you drawdown as you pay off each line. Each drawdown has a 12 month repayment period and you can extend your line of credit facility for a further one year, at the end of 12 months.

When using a line of credit, you will need to make at least one drawdown within 4 weeks of approval to activate the line.

Like with a business loan, Lumi credit lines are about one months’ worth of business turnover. If you require a loan of greater size, then speak with a Lumi consultant and they will work with you to find a loan that suits your needs. The amount they can lend you may depend on the business credit history, trading life and if you have any security you can use.

Lumi Business Line Of Credit Costs And Fees

Lumi finance line credit costs

While a credit line allows you to drawdown capital when you need it, you will need to pay $25 each time you activate a drawdown. You will only pay interest on the capital you draw from the facility and this interest is fixed, with the interest calculated using the remaining principal each day. The other cost to be aware of is the $30 monthly fee to maintain the credit line facility.

Like with a business loan, you will get a SMART Box™ statement outlining all your costs, this means there will be no hidden costs or charges.

Unlike the business loan, you can make additional payments to reduce the interest amount you will pay on the principal or you can close the facility early with no penalty and not have any further interests cost.

Lumi Business Line of Credit Payment

Lumi uses automatic debit to deduct your payment on a weekly basis.which means you do not need to worry about missing payments.

Lumi Ease of application

Lumi has a simple online application with the application process neatly split into 3 stages:

  1. About your loan
  2. About your business
  3. About you

The application process is a series of webpages, each with one question, that will help Lumi find the right loan for you. Lumi asks you the following questions:

Funding requirements

  1. What do you need the funds for? (you can choose from 14 reasons)
  2. DO you need ongoing access to funds or a one-off loan?  (this will determine if a business loan or line of credit is best for you)
  3. What is the loan amount you are looking for?
  4. What is the ideal loan duration? (in months, up to 18 months)
  5. How long have you been trading for? (0-6 months, 6-12 Months, 1-4 Years, 4+ Years)

Your business

  1. What is your ABN/ACN
  2. What industry is your business in?
  3. What’s your average monthly turnover?

About you

  1. About you (personal details – full name, email address, phone number, password

You will need to provide the business bank account details (that you use for online banking) or link your cloud accounting software. This will allow Lumi finance to verify your business meets their qualification requirements and perform a credit check. If you cannot do either of these, you can provide accounting statements or bank statements as a PDF.

On completion of these details, Lumi will advise you on the spot how much capital you qualify for. Most applicants can borrow up to a months’ worth of turnover. This amount is relatively standard for the industry.

Lumi finance application process

Lumi Funding speed

Lumi finance funding speed

Lumi can approve your loan within 2 hours if you provide all the correct details as part of your application. Funds can be deposited into your business account on the same day or the next business day after the loan is approved.

What can you use the loan for?

Lumi will lend to most small and medium business but have a focus on retail, hospitality and professional services. They will also provide loans to trade and labour, health and wellness and franchises. You can use the loan for any business reason and you are able to use the loan for personal reasons.

The lender suggests the following reasons as part of the application process, to use the loan:

  • Paying suppliers
  • Paying staff
  • Cash flow
  • Marketing spend
  • Paying off existing debt
  • Buy equipment
  • Buy inventory
  • New hires
  • Capital to expand
  • Renovation
  • Relocation/expansion
  • Tax
  • Other
  • Buy or start a business
Lumi finance benefits

Lumi Review – Trustpilot and Customer Service

Lumi has a TrustPilot Score of 4.9 (5 stars) from 110 reviews which is an excellent grading. Comments regarding their customer service were extremely favourable, with big thumbs up given to the fast approval process. Many reviews suggest the customer service team goes above and beyond the client’s expectation, which can only be a positive thing.

Our Lumi Review Conclusion

Lumi aims to help small business overcome the challenges of getting loans from a bank by making loans simple, fast and flexible.

The key features borrowers will want to be aware of include:

  1. Exceptionally fast loan approval – Loans can be approved in just 2 hours with funding on the same day.
  2. 2 types of financing for flexibility
    1. Business loans are best when you know how much you need to loan,
    2. Line of credit if you only wish to pay interest for what you draw
  3.   Transparency – no hidden fees as your costs are fixed in place of a variable rate

If you need funds in a hurry and are not sure what type of loan is the best for you, then Lumi can be a dependable option. The only thing to keep in mind is that if the finance for a business loan is greater than $150,000, then you may need security. While security is optional for a line of credit but can lead to better loan conditions.

About Lumi

Lumi was founded in 2018 by its current CEO Yanir Yakutiel. After success in starting up Sail Funding, a similar small business lender and Fintech, Yanir along with 13 other colleagues at Sail moved to start up Lumi with the goal of starting up a business that offers a fast, flexible, and transparent loan that is tailored to specific needs of the business.

Yanir built Lumi specifically to focus on Australian businesses that are vulnerable to bad credit and therefore need easier access to finance. Yanir explains “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.”

Lumi believes its role as a technology-enabled lender gives them an edge over its competitors. The lender uses the power of big data and analytics to create solutions that fill the lending gap that small business owners face. The technology also allows Lumi to process applications and provide funding with speed.

The financial services provider lives by its saying “With us, you’re not a loan” and has a business model built on 3 pillar:

  • Transparency – Lumi promises solutions that are transparent, accurate, and upfront. Hidden fees are banished.
  • Responsibility – honest, fair and responsible lender. They will not offer loans to businesses that can’t repay their debts
  • Customer Service – Lumi credit specialist will work with clients to find fully customised solutions.

Lumi Financial Management Pty Limited ABN 79 627 897 643 is located at 206/2 Grosvenor St, Bondi Junction NSW 2022