What is a loan repayment schedule and why is it important

Many people take a personal loan to meet different financial needs, whether it’s home improvements, a wedding, or unexpected expenses. When you borrow, repayment happens in a structured manner through monthly instalments called EMIs. This schedule, also known as an EMI amortisation schedule, helps you track both principal and interest payments over time, so you know exactly what you owe and can manage repayments comfortably. You can also check if you already have a pre-approved offer in your city. The entire process is online, no branch visit required: Check your pre-approved loan offer with phone number and OTP → Apply online in 5 minutes → Receive funds within a day*.

Having a clear repayment plan makes managing your finances simpler and helps you avoid missed payments. Get funds in 24 hours by understanding how your personal loan repayment schedule works and planning your EMIs efficiently.

Loan repayment is the process of returning the money you borrowed to the lender over a set period. It involves paying back both the principal amount and the interest accrued, usually in regular monthly instalments. Personal loans, mortgages, and student loans all follow this process. Timely repayment is crucial to maintain a good credit score and avoid penalties, which can affect future borrowing.

Most personal loans are repaid through equal monthly instalments (EMIs), comprising two parts: principal and interest. Both are paid on the same date each month until the loan is fully repaid.

Initially, the interest component of an EMI is higher, while the principal component is lower. Over time, as you pay down the loan, the principal portion increases, and the interest reduces. This gradual shift is standard across most personal loans, though the exact distribution may vary by lender.

Lenders provide an EMI amortisation table, showing exactly how your loan will be repaid over time. This table details how much of each monthly EMI goes towards interest and how much reduces the principal. It’s usually created using a loan amortisation calculator. With this table, you can see your opening principal, interest charged each month, and the remaining balance after each EMI.

Your loan repayment schedule typically includes:

• Instalment serial number
• EMI due date
• Opening principal amount
• Closing principal amount after EMI

• Interest rate component

  
  

Additional read: How to plan your personal loan EMI repayment better

Repaying your loan on time has several benefits:

• Helps decide the loan amount: Reviewing EMI amounts and repayment schedules ensures you borrow an amount that fits comfortably within your income. Consider your fixed obligations to income ratio (FOIR) before committing.
• Helps plan prepayments: Partial or full early repayments reduce the principal, saving interest in the long run. The earlier you repay, the less interest you pay. Prepayments also help maintain a strong credit score.
• Maintains credit score: Timely payments positively impact your credit score, which is essential for future loans.

Knowing your repayment options ensures you repay comfortably and on time. Only 2 steps to check your eligibility for personal loan → Use a personal loan EMI calculator to calculate your EMIs and view your repayment schedule.