Tips to Manage Your Personal Loan EMI Online

15 JULY, 2025

Getting a top-up on your Personal Loan is taxing to pay back. Your overall EMI increases, and you have to pay now more than you used to before. However, if you build a proper strategy, then it is easier to manage your EMIs. Let's go through a few solutions you can adopt:

Plan a Repayment Strategy

To understand how much EMI you can pay with your monthly expenses with a top-up, a repayment plan helps.

It will be a detailed budget that manages your monthly loan payments and expenses like utility bills, rent, groceries, and loan obligations. Keep a specific portion of your income to repay the loan to avoid any penalties. Several budgeting tools or apps can help you track repayments and expenses.

Choose a Suitable Tenure

When you opt for a Top-up Personal Loan, your tenure can also be extended. A longer tenure means lower monthly EMIs, but it also means that you have to pay more interest. If you opt for a shorter tenure, the EMI amount is a strain, but you don’t have to pay a hefty interest.

Carefully analyse which one of the two options works the best for you and calculate your monthly EMI with a Personal Loan EMI calculator.

Make Part Prepayments

One way to reduce your EMI is to opt for part prepayment of your Loan. Many lenders allow part prepayment after you have paid a certain number of EMIs (usually after a year). Once you pay a substantial amount of the loan, your principal amount decreases and so is your EMI.

When you opt for part prepayment, the bank charges a fixed nominal fee for each time. At Kotak Mahindra Bank, you can do a part prepayment of your Loan after paying EMIs for 12 months. You can pay 20% of the principal amount with a nominal fee of Rs. 500 + taxes if you have n the loan after 1^st February 2020. You can utilize your annual bonus, incentives, and interest from investments to make part prepayments of your loan.

Opt for a Balance Transfer Loan

A balance transfer of your l oan is another way to manage and reduce your EMIs. It helps you transfer your existing loan from one bank to another. If you come across a bank that offers lower interest rates, then you have the option to transfer the loan. However, during the transfer, there are a few costs that are associated with it like processing fees and foreclosure charges other than lower interest rates.

Think about Step-down EMI Plan

This plan is similar to making part prepayments. In this plan, you repay a big chunk of your principal amount along with the interest in the early years of the loan. So, for the rest of the tenure, your EMI amount is reduced. This reduces your financial burden and is best for people who are about to retire as they still have time to repay while they are earning.

Opting for Auto-Debit from Salary Accounts

There are times when you forget to pay your EMI on time. It piles up with penalties even when you have funds. The easiest solution is to link your EMI to your salary account and set up auto-debit. So, you don't have to keep constant track of EMI deadlines, and it will also increase your credit score.

Set Up EMI Alerts with UPI or Banking Apps

If you are not comfortable with the idea of auto-debit, then you can set EMI Alerts on your UPI or Banking Apps. We all use UPI apps every day and setting alerts in the same app will remind that payment date is near. Some apps even show your loan repayment history if it is linked properly. Other than UPI apps, you can also set up alerts on your mobile banking app. Once you opt for alerts, they send you reminders through SMS, Email and push notifications a few days before the due date.

Create a “Loan Payoff” SIP Using Mutual Funds

Well, this is a unique method where you can use your investment to manage your top-up Personal Loan EMI. This doesn’t involve keeping a certain amount for prepayment but using it smartly.

How do you do it – starting a SIP in a debt mutual fund dedicated to your loan prepayment only. In this strategy, you invest a fixed amount monthly in a mutual fund. After 6 or 12 months, you can use the total investment to make part prepayment for your loan.

Investing in debt mutual funds is an ideal way as it is less volatile than equity funds and offer better returns than fixed deposits. Its flexibility also ensures that you can withdraw the amount anytime you want for your loan. Start a SIP and build a fund over time to reduce your loan EMIs whenever needed. Let's see how this can work for you:

For example, your current EMI is Rs. 12,000 per month and you want to reduce your EMI amount. You start an SIP of Rs. 5,000 per month in a mutual fund (short-duration debt fund):

After 12 months, your investment approximately grows to Rs. 63,000 (~ 6% annual return)
You can use this amount to make part prepayment toward your top-up personal loan
This will reduce your outstanding principal amount and your EMI.
If your finances support you, you can continue the SIP for the next cycle.

Conclusion

These strategies are an efficient solution to save on high interest amounts and reduce your burden of hefty monthly EMIs. At Kotak Mahindra Bank, opt for a top-up Personal Loan at attractive interest rates, swift approval, and flexible repayment options. This makes it the best choice for you to manage your financial needs.

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.

Managing EMI After a Top-Up Personal Loan