Personal Loan Part-Prepayment
Pay off part of your personal loan early — lender rules, charges and whether to cut EMI or tenure.
Updated 27 September 2026 · 8 lenders trackedWhat you need to know
Part-prepayment lowers your outstanding principal, so all future interest falls. Rules vary widely: IDFC FIRST charges nothing, ICICI charges 3% of principal outstanding in the first 24 months and nothing after, YES Bank allows part-prepayment only after 12 EMIs, and Axis Bank charges 2% – 3% depending on tenure.
What a ₹1 lakh prepayment saves
| Option | EMI | Months left | Interest still payable | Interest saved |
|---|---|---|---|---|
| No prepayment | ₹10,871 | 48 months | ₹1,01,196 | — |
| Reduce tenure (same EMI) | ₹10,871 | 35 months | ₹54,902 | ₹46,294 |
| Reduce EMI (same tenure) | ₹8,287 | 48 months | ₹77,137 | ₹24,059 |
₹5,00,000 at 11.00% for 5 years; ₹1,00,000 prepaid after 12 EMIs (outstanding then ₹4,20,623). If your lender charges 3% + GST on the amount prepaid, subtract ₹3,540.
Lender rules
| Lender | Part-prepayment terms |
|---|---|
| IDFC FIRST Bank | No charge |
| ICICI Bank | 3% of principal outstanding up to 24 months; nil after 24 EMIs |
| Axis Bank | 3% or 2% depending on tenure (BankBazaar) |
| YES Bank | Allowed after 12 EMIs |
| Bank of Baroda | Zero (ClearTax); none on floating-rate loans under RBI rules |
| SBI | RTXC page lists no penalty; aggregators report 3% on fixed-rate Xpress Credit |
Prepayment calculator
Frequently asked questions
When is the best time to prepay?
As early as possible — interest is highest in the first months, and some charges fall with loan age (e.g. ICICI after 24 EMIs).
For information and comparison only. Loan terms, rates and rules change — confirm with the lender and read the Key Facts Statement before borrowing.