How to Make Advance Payment on a Secured Loan

An advance EMI payment clears one specific upcoming instalment early, but it isn't the same as reducing your loan, your principal and interest calculation stay exactly the same, and every EMI after the one you've prepaid still needs to be paid on its own schedule.
 

• Paying early doesn't buy you ongoing breathing room. An advance payment covers one selected instalment, the very next EMI after that still falls due on its normal date, don't assume you're ahead for the rest of the loan
• If your real goal is saving on interest, this isn't the tool for it. Advance EMI doesn't touch your outstanding principal, if you want to actually reduce your interest cost or shorten your tenure, check whether part-prepayment is available instead
• Not every secured loan offers this option. Availability depends on your specific loan account and terms, check what's actually displayed for your loan before assuming it applies
• Confirm the payment landed on the right instalment. After paying, check your repayment schedule to verify the advance payment was applied to the EMI you intended, not just that a payment went through

Before making an advance EMI payment, confirm through My Account exactly which upcoming instalment it will cover, and if reducing your overall interest cost is actually your goal, check whether part-prepayment is available for your loan instead.

An advance payment on a secured loan means paying an upcoming EMI before its scheduled due date. The payment is applied towards the applicable monthly instalment rather than being treated as a part-prepayment of the outstanding principal. A secured loan is backed by an asset or security provided under the loan arrangement. Depending on the loan type and applicable terms, the security may include property, gold, a vehicle, or another eligible asset. Making an advance EMI payment may be useful when you have funds available before the next due date and want to pay an upcoming instalment early. However, the treatment of an advance payment can vary based on the loan type, repayment arrangement, and applicable terms. An advance EMI payment and a part-prepayment serve different purposes. Before making a payment, check the available payment options and select the one that matches your repayment requirement. This can help ensure the payment is applied as intended. 

How to make an advance EMI payment for a secured loan?

You can make an advance EMI payment for an eligible secured loan through My Account or the Bajaj Finance App. The available payment options and steps may vary depending on your loan account. Check the payment option displayed for your account before completing the transaction.

Steps through My Account

1. Sign in to My Account using your registered mobile number and OTP.
2. Go to Loan payment from the main menu.
3. Select Other payments and choose the relevant loan account.
4. Select Advance EMI as the payment option.
5. Review the payment details and select the applicable upcoming instalment.
6. Choose an available payment method and complete the transaction.
7. Check your loan account or repayment schedule after payment to confirm the updated details.

The current My Account payment flow provides an Advance EMI option for eligible loan accounts.

Steps through the Bajaj Finance App

You can use the Bajaj Finance App to manage repayments for eligible loan accounts. To make an advance EMI payment:

1. Sign in to the Bajaj Finance App using your registered mobile number and OTP.
2. Open the relevant loan account.
3. Check the available payment options for the account.
4. Select the Advance EMI option, if available.
5. Review the payment details and applicable upcoming instalment.
6. Choose an available payment method and complete the transaction.
7. Check the loan account or repayment schedule to confirm the updated details.

If the Advance EMI option is not displayed, check your loan terms or use the available service and support options to confirm the payment method applicable to your account. Retain the payment confirmation for your records.

When should you make an advance EMI payment?

An advance EMI payment may be suitable when you have sufficient funds available before your next EMI due date and want to pay an upcoming instalment early. The decision should depend on your cash flow, repayment schedule, and the payment options available for your loan account.

Before making an advance EMI payment, check the payment option available for your loan account and confirm how the payment will be applied. An advance EMI payment is different from part-prepayment and does not automatically reduce the outstanding principal or shorten the loan tenure. Choose the payment option based on your repayment requirement and retain the transaction confirmation after completing the payment. Checking your loan account or repayment schedule afterwards can help confirm that the payment has been applied as intended.

After you make an advance EMI payment, the amount goes through payment processing and is applied to the upcoming instalment selected for advance payment. Once processed, the payment should be reflected in your loan account, while other EMIs continue according to the repayment schedule.

What to expect once your advance EMI is paid:

• Payment processing: The advance EMI payment is processed before being applied to the selected upcoming instalment.
• Upcoming EMI: The selected instalment is covered by the payment and does not need to be paid again on its scheduled due date, subject to successful processing.
• Loan account update: Once processed, the payment should be reflected in your loan account and repayment records.
• Next EMIs: After the advance-paid instalment, subsequent EMIs continue as scheduled under your repayment plan.
• Payment confirmation: You can check your loan account or repayment schedule to confirm that the advance EMI has been applied.
• Remaining loan balance: The advance EMI payment does not automatically reduce the outstanding principal, so the remaining loan balance continues according to the applicable repayment schedule.

Check your loan statement or repayment schedule after the payment to confirm that the advance EMI has been applied correctly. If the payment is not reflected or the account details do not match your records, retain the transaction confirmation and raise a request through an official channel.

What happens if you miss an EMI after making an advance payment?

Missing an EMI that falls outside the period covered by your advance payment can result in the instalment becoming overdue and may affect your credit record according to applicable reporting practices. Paying one or more EMIs early does not permanently remove the need to make future payments on time.

For example, if your advance payment covers an upcoming instalment but your next scheduled EMI is not covered, that next EMI remains payable on its due date. Keep sufficient funds available and review your repayment schedule regularly.

If an EMI becomes overdue:

1. Check the outstanding amount and payment status in your loan account.
2. Review whether the earlier payment was applied to the intended instalment.
3. Clear the applicable overdue amount through the available payment option.
4. Continue monitoring subsequent EMI due dates.
5. If the payment has not been reflected correctly, raise a service request through the available official support channel.

Timely action can help prevent an overdue account from continuing to remain unpaid.

Does advance EMI payment reduce interest or loan tenure?

An advance EMI payment does not automatically reduce the interest payable or shorten the loan tenure. It is generally applied towards an upcoming EMI before its scheduled due date, rather than reducing the outstanding principal. Since the principal balance is not automatically reduced through an advance EMI payment, the remaining repayment schedule continues according to the applicable loan terms. This is different from part-prepayment, where an amount is paid towards the outstanding principal and may affect the interest payable or loan tenure, subject to the loan agreement and applicable terms. If your objective is to reduce the overall interest cost or repay the loan earlier, check whether a part-prepayment option is available for your loan account. The treatment, charges and effect of part-prepayment can vary by loan type and applicable terms. Review the available payment options before making a payment to ensure you select the option that matches your repayment objective.