Last updated 12 Nov 2026
If you miss an EMI, the lender usually adds a penal charge and a bounce charge, reports the delay to the credit bureaus after a grace period, and starts calling you. If the missed payments continue, the account is classified as a non-performing asset, your credit score falls sharply and the lender can begin recovery.
One late payment that you fix quickly is a small problem. A pattern of missed payments is a serious one. The most useful thing you can do is contact the lender before the due date, not after.
What happens, step by step
The usual sequence after a missed EMI
| When | What usually happens | What you should do |
|---|---|---|
| Due date passes | A payment instruction fails or no payment arrives; a bounce or penal charge may apply | Pay as soon as you can; keep the proof of payment |
| Days 1 to 30 | Reminders by call, SMS or email; the delay may be reported to the credit bureau as days past due | Pay the EMI plus charges; ask the lender to confirm the account is regular |
| Days 31 to 90 | The account is marked as a special mention account; calls become frequent; the credit score falls | Write to the lender and propose a plan |
| After 90 days | The loan can be classified as a non-performing asset; recovery steps start | Seek a written restructuring or settlement plan |
| After classification | Legal notice; for secured loans, action on the asset under the law | Get advice; do not ignore notices |
The timing of these steps differs by lender and by product, and the lender's policy and your loan agreement decide the details. Read NPA and SMA for the plain meaning of these stages.
The money cost
A missed EMI adds penal charges. RBI's approach for regulated lenders is that the penal charge is a stated amount for the delay, not an addition to the interest rate, and it should not be charged on top of itself. The agreement and Key Fact Statement state the amount. A failed auto-debit can also trigger a bounce charge from the lender and a charge from your bank. Taxes can apply to these fees.
A worked example: your EMI is ₹12,000 and the payment fails on the 5th. You pay on the 12th. You owe the EMI, a penal charge for the days of delay, a bounce charge and tax on the charges. The extra money is usually modest. The larger cost is the record that the payment was late.
The credit score effect
Lenders report your payments to the credit bureaus, and a late payment is recorded as days past due. Payment history is the biggest part of your credit score. A single late payment can bring the score down, and the drop is larger when your history is short or the delay is long. The record stays on your credit report for years, even after you pay. See repayment history and the CIBIL score guide.
Paying on time for the following months starts to rebuild trust, and the effect of an old late payment fades with time. Regular dues, kept low card balances and no new late payments help the score rise again.
What the lender can and cannot do
Lenders may remind you, call you at reasonable hours, visit your registered address and send notices. They must follow RBI's fair practices and recovery conduct rules, which require a lender and its agents to behave respectfully.
- A lender cannot use abusive language, threats or intimidation
- A lender cannot call you at odd hours or contact people who are not part of the loan to shame you
- A lender cannot take your belongings or enter your home without lawful authority
- For an unsecured personal loan, a lender cannot seize your property without a court process; it can start civil recovery or send a legal notice
- For a secured loan, the lender can act on the asset after due notice under the law, including under the SARFAESI Act for many lenders
The SARFAESI Act entry explains the secured-loan process, and the affordability calculator tests an EMI before you take it. If you face harassment, note the date, time and what was said, write to the lender's grievance officer and, if it is not resolved, go to the RBI Integrated Ombudsman. See borrower rights and grievance.
Secured loans carry a higher stake
A missed EMI on a home, car or gold loan puts the asset at risk. A lender gives notice first and normally gives a period to pay, but if the account is classified as non-performing and the default continues, it can take possession and sell the asset. The sale price is applied to the dues and any balance comes back to you; a shortfall can still be claimed. Read mortgage and hypothecation.
If you think you will miss an EMI
- Contact the lender before the due date, by phone and then in writing, and explain the reason.
- Ask what options exist: a short payment holiday, a change of due date, a longer tenure or a restructuring.
- Pay what you can rather than nothing, and ask the lender to record the part-payment.
- Protect the essentials first, such as rent, food and secured loans.
- Keep every message and receipt.
- Avoid taking a new loan only to pay an old EMI, unless the new terms are clearly better.
Options when you cannot pay
Lenders have options at their discretion, and these are not rights. A change in the due date can fit an EMI to your salary date. A longer tenure lowers the EMI but increases total interest. A moratorium pauses payments for a time, but interest may continue to accrue. A restructuring changes the terms and may be reported on your credit record. A settlement closes the loan for less than the full dues but is recorded and hurts your score, so see loan settlement vs closure and settled vs written off. Consolidation can combine several loans into one; read debt consolidation.
How to avoid missing an EMI in the future
- Keep a buffer in the repayment account equal to at least one EMI
- Set the due date near your salary date
- Use the reminders in the lender's app or in your account for active EMIs
- Do not keep EMIs larger than your income can carry in a bad month; test an EMI before you take it
- If you change bank accounts, update the mandate before closing the old one
Applying through LOANZ 360
LOANZ 360 is a loan aggregator, not a lender. After disbursal, active EMIs can be tracked in your LOANZ 360 account with due dates and reminders, which helps you avoid a late payment. Our team prepares a credit assessment summary before the file reaches a lender. The lender sets the charges and decides on any change to your repayment terms.
Frequently asked questions
Will one missed EMI affect my credit score?
It can. A payment that is a few days late may be recorded as days past due once it crosses the lender's reporting threshold. The effect is bigger the later the payment is and the shorter your history. Paying on time afterwards helps the score recover.
How many missed EMIs make my account an NPA?
A loan is generally classified as a non-performing asset when dues are unpaid for more than 90 days. The lender will have taken earlier steps by then. Check your agreement and speak to the lender well before that point.
Can the lender call my family or employer?
Lenders may contact the people you listed as references to reach you, but they cannot harass, threaten or shame you or share your debt with others. Report any such conduct to the lender's grievance officer and, if needed, to the RBI Integrated Ombudsman.
Can I ask for a break in payments?
You can ask. A lender may offer a holiday, a due date change or a longer tenure, but it is the lender's decision and interest or charges may still apply. Ask for any change in writing.
What is better, settling the loan or paying in full?
Paying in full keeps your record cleaner. A settlement closes the loan for less, but it is recorded as settled, which lenders view negatively for years. Consider a settlement only when full repayment is not possible.
Will paying late fees remove the mark on my report?
No. Paying the dues and charges stops the dues from growing, but the late payment stays on your report. You can ask the lender to correct a wrong entry, not to delete a correct one.
Related reading: Personal loans, Home loans, Loan settlement vs closure, Borrower rights and grievance, Credit score guide (CIBIL or another bureau), Debt consolidation loan, Penal charges, NPA and SMA, Affordability calculator.