Bank Account

Transactions & Operational Events

A loan account records disbursements (direct to borrower, or to seller/institution for home/education loans, in tranches where applicable), monthly EMIs (with a shifting principal/interest split visible in the amortisation schedule), interest-rate resets for floating-rate loans (repo-linked EBLR, with mandatory borrower communication on any rate or tenure change), prepayments, and closure. Key regulatory updates: RBI’s Pre-payment Charges Directions (July 2025) prohibit prepayment penalties on all floating-rate loans to individuals for non-business purposes (regardless of source or lock-in period), from any regulated entity. RBI’s August 2023 circular (effective 1 April 2024) abolished penal interest — lenders can only levy defined, non-compounding penal charges for specific non-compliance events, disclosed upfront in the loan agreement and Key Facts Statement. We also cover part-payments (most impactful in early tenure, reducing principal on which future interest is calculated), pre-EMI interest during disbursement periods, loan restructuring and its credit bureau impact, balance transfers, and the full closure checklist: NOC, return of original documents, mortgage discharge registration, and credit bureau update — each of which requires active follow-up by the borrower.