Axis Auto Finance closed a new $40 million senior secured debt facility with Royal Capital Management.

The facility has a two-year term and bears interest at prime rate plus 7.5%. Amounts drawn under the facility will be used to refinance the company’s existing debt and to originate, acquire and administer auto loans in the ordinary course of business.

The terms of the new facility represent a decrease of more than 30% in interest expense compared to the previous senior debt and the size of the debt facility has doubled from $20 million to $40 million. The indebtedness of the company to Traverse, in the amount of $14 million, has been fully repaid.

“The establishment of an institutional funding conduit was a strategic priority for us and we are very pleased to work with RoyCap as a key partner going forward,” commented Ilja Troitschanski, CEO of Axis. “The significant savings on interest will bolster our bottom line and the size of the new facility gives us ample runway to continue growing our business.”