Lumi
Alternative finance provider offering flexible loan and refinancing products. Pride’s current largest loan facility, refinancing the Square Capital debt in March 2024 and subsequently extended multiple times for operational cash flow.
Facility Evolution
Original refinancing (28 March 2024):
- Refinanced all 7 Square Capital loans (total principal $536,100)
- Initial draw: $99,000.00
Subsequent draws and extensions:
| Date | Description | Amount |
|---|---|---|
| 28 Mar 2024 | Initial refinancing (paid out Square Capital) | $99,000.00 |
| 30 Jun 2024 | Establishment fee capitalised | $1,790.00 |
| 30 Jun 2024 | Interest expense capitalised | $5,514.47 |
| 17 Sep 2024 | Additional loan draw | $20,000.00 |
| 22 Nov 2024 | Extension — rent backpayments | $25,000.00 |
| 11 Feb 2025 | Additional draw | $20,000.00 |
| 29 Apr 2025 | Major extension/refinancing | $109,585.32 |
| Total borrowed | $280,889.79 |
Repayment Terms
Weekly repayment schedule:
- Started at $889.84/week (after initial refinancing)
- Increased to $1,603.63/week (likely reflecting larger balance after Apr 2025 extension)
- Total repaid to 8 Apr 2026: $135,998.98
- Current outstanding balance: $144,890.81
Repayment frequency: Weekly (automatic deductions from bank account)
Payment Processor
- Initially processed through “Lumi” directly
- Changed to “Zai Australia” around November 2025 (Zai is Lumi’s payment infrastructure provider)
- No change in terms or principal; administrative change only
Accounting Treatment Issues
Current state (Xero account 503):
- Account balance: $144,890.81 (appears correct)
- All repayments coded to account 503 (no principal/interest split)
- One-time interest capitalisation in Jun 2024 ($5,514.47) suggests accountant recognises interest should be separated, but not ongoing
Problems:
- Interest expense unrecognised: Weekly repayments include embedded interest component not separated from principal. FY25 interest expense ~$29,530 entirely unrecognised on P&L.
- Loan balance potentially overstated: Without loan schedule, cannot determine if Xero balance ($144,890.81) represents actual principal owed or if Lumi charges interest separately.
- Repayment schedule unavailable: Without knowing principal vs interest split, cannot forecast loan payoff timeline or total cost of borrowing.
Action Items
- Obtain Lumi loan schedule: Needed to determine principal/interest split for each weekly repayment
- Reconcile Xero balance against Lumi statement: Verify $144,890.81 matches Lumi’s records
- Assess total cost of borrowing: $280k borrowed, $136k repaid, $145k owing—total interest cost should be understood for financial planning and strategic decisions
Loan Rate Analysis (April 2026)
Added per Hospitality Debt Restructuring Research.
Implied Rate
Lumi’s published rate range is 15.5%–44.5% APR (money.com.au). Mathematical analysis of the payment schedule implies this borrower’s rate is approximately ~30% APR:
| Metric | Value |
|---|---|
| Outstanding balance (stated) | $144,800 |
| Weekly repayment | $1,603.63 |
| Weeks remaining | 90.3 (~21 months) |
| Implied remaining principal | ~$116,000 |
| Embedded future interest in $144,800 | ~$28,000–$35,000 |
| Annual debt service | ~$83,389 |
The $144,800 “outstanding” represents total remaining scheduled payments (principal + pre-calculated interest combined), not the principal balance alone.
Rate Ease Feature
Lumi’s Rate Ease feature automatically reduces rates for loans at 29%+ APR. If all payments have been on time, this may have already been applied — confirm with Lumi.
Hardship Policy
Lumi’s hardship provisions are more restrictive than banks. Lumi explicitly will not offer term extensions or interest freezes — only temporary payment reductions or pauses. If Lumi refuses hardship: escalate to AFCA (1800 931 678) at no cost — this suspends all collection action while the complaint is active.
Early Repayment
Lumi charges no early repayment penalty and “may provide a discount on the remaining interest.” This discount is discretionary but could be worth $28,000–$35,000.
Immediate Action
Call Lumi (1300 005 864) — request formal payout figure including early settlement discount. This is the single most important first step in any debt restructuring pathway. See Debt Restructuring Options for full action sequence.
Related Pages
- Loan Accounts Diagnostic — overview of all Pride’s loan facilities
- Loan Accounts Diagnostic — detailed account-by-account diagnostic
- Interest Expense Recognition — how to properly split principal vs interest
- Westpac — other major loan facility with similar interest allocation issues
- Financial Reporting — P&L impact of unrecognised interest
- Debt Restructuring Options — pathways to resolve Lumi debt
- Hospitality Debt Restructuring Research — source: rate analysis and restructuring options