Small business lender Lumi has received a significant funding boost, securing a new A$40 million warehouse facility funded by NAB and Alexander Funds Management.

Lumi has been in business since 2018 and has been funded up to this point by an Israeli private debt and equity fund manager, Arbel Finance.

Lumi chief executive Yanir Yakutiel said the company was able to create its warehouse architecture working with Arbel and is now ready to expand.

Lumi’s loan portfolio is in the tens of million, with most of its lending for working capital. The company offers secured and unsecured, amortising and line of credit finance.

Yakutiel said its sweet spot was loans between $50,000 and $100,000 with terms of 18 to 24 months.

He said that when COVID hit last year, lending activity initially spiked as businesses drew down on the loans to ensure they remained liquid.

“Then we had five or six months when businesses avoided taking on additional debt unless they were in sectors that were positively impacted by the pandemic,” he said.

“Coming out of the third quarter confidence started to return and business picked up again.”