Bounce Charges and Penal Charges: Understanding Their Impact on Your Loan

A bounce charge may apply when a scheduled loan repayment is unsuccessful during processing. This can happen when an EMI is not collected through an applicable auto-debit method such as NACH or ECS, or when a repayment cheque is dishonoured. Common reasons may include insufficient funds, incorrect bank or mandate details, an inactive mandate, technical issues, or other banking-related restrictions. A bounce charge is separate from the EMI, and the underlying repayment obligation remains due if the failed payment is not cleared.

A penal charge may apply when a borrower does not meet a repayment obligation as specified under the applicable loan terms. It is separate from the regular EMI and may increase the amount payable on the account, where applicable. The exact applicability and amount should be checked in the loan agreement and official account information. If an EMI remains unpaid after its due date, review the loan account for the outstanding amount and applicable charges, and take timely repayment action through an authorised channel.

Common reasons for a payment bounce

• Insufficient balance: The linked bank account does not have enough funds when the payment is presented.
• Mandate issue: The NACH or ECS mandate may be inactive, expired, or incorrectly registered.
• Incorrect details: Bank account or mandate information may contain an error.
• Technical issue: A temporary banking or payment-processing issue may prevent the debit.
• Bank-related reason: Account restrictions or other banking issues may result in payment failure.

What is the difference between bounce and penal charges?

Bounce charges relate to unsuccessful payment processing, while penal charges may relate to non-compliance with a repayment obligation under the applicable loan terms.

The two charges address different aspects of repayment. A failed payment may result in a bounce charge, while an unpaid or delayed obligation may also attract other applicable charges depending on the loan terms. Check the loan statement and applicable agreement for the charges reflected on your account.

Bounce and penal charges can affect your loan account in several ways when an EMI payment fails or remains overdue. The exact impact depends on the applicable loan terms and account status.

• Higher amount payable: Applicable bounce or penal charges may increase the total amount due.
• Overdue status: An unpaid EMI may continue to appear as overdue until the payment is successfully processed.
• Additional repayment obligation: The original EMI remains payable even if a payment attempt has failed.
• Credit reporting impact: Continued repayment delays may affect information reported to credit information companies, as applicable.
• Further account follow-up: Unresolved dues may require you to take additional repayment or servicing action.
• Legal communication: Where applicable, continued non-payment may result in formal communication or other action according to the loan terms and applicable law.

If you have received a legal notice, review the stated amount and required action carefully. Compare it with your loan account and payment records, and address any outstanding amount through an authorised channel.

Pay overdue EMI and applicable charges through Bajaj Finance platforms

You can check available repayment options through authorised Bajaj Finance digital platforms and clear the outstanding amount reflected against your loan account.

Through the Bajaj Finance App or My Account

1. Open the Bajaj Finance App or visit the My Account portal.
2. Sign in using your registered mobile number and complete OTP verification.
3. Go to Service and select the relevant loan account under Your Relations.
4. Select Make loan payments.
5. Choose the available Missed instalments/bounce charges payment option, where displayed.
6. Review the amount payable and complete the payment using an available method.
7. Save the payment receipt or transaction reference.
8. Check the loan account again to verify that the payment has been recorded.

The available menu names and payment options may vary by loan type and account. If the payment has been debited from your bank account but is not reflected in the loan account, retain the transaction details and raise a service request through an authorised channel.

How can you avoid bounce and penal charges?

Regularly monitoring your EMI due date, linked bank account, and loan status can help reduce the risk of payment failures and overdue amounts.

Use these repayment checks:

• Keep sufficient funds available in the linked bank account at least three days before the EMI due date.
• Check that your NACH or ECS mandate is active and correctly configured.
• Keep bank and mandate details updated.
• Set reminders for upcoming EMI due dates.
• Review your loan account after the scheduled payment date.
• Act promptly if an auto-debit fails.
• Retain payment confirmations and transaction references.

If you have already received a legal notice, do not delay action because of a payment failure. Review the outstanding amount and notice requirements, then use an authorised repayment or service channel to address the account.