What Happens If EMI Is Missed? Penalty, Credit Score & Solutions

Missing an EMI is more common than people think. Whether it is a Personal Loan, Business Loan, Home Loan, Education Loan, or Vehicle Loan — any missed EMI has consequences that every borrower should know.

Banks and NBFCs consider timely EMI repayment as the strongest indicator of financial discipline. Even a single missed EMI can affect your credit score, penalty charges, future loan eligibility, and sometimes legal notices depending on severity.

Why Do EMI Misses Happen?

People miss EMIs for various reasons including salary delays, medical emergencies, business losses, unexpected expenses, or simply forgetting the due date. No matter the reason, every lender follows a fixed penalty and reporting structure.

Impact of Missing an EMI

1. Late Payment Penalty

When an EMI is missed, the first impact is a penalty charge. Most banks charge:

2% to 4% penalty on the EMI amount
Additional GST on penalty
Daily interest until EMI is cleared

Example:
If your EMI is ₹5,000 and penalty is 3%, you will pay ₹150 extra + GST. If payment delays continue, the amount increases further.

2. Credit Score Drop

Credit bureaus (CIBIL, Experian, CRIF) immediately record missed EMIs. A single missed EMI can drop:

50 to 120 points for first-time defaulters
150+ points if payment is delayed for 30+ days

If your score drops below 650, most banks decline fresh loan applications or credit cards.

3. Higher Interest Rates for Future Loans

Even if you pay the EMI later, lenders classify you as a higher-risk borrower. This leads to:

Higher interest rates
Lower loan amount eligibility
More document requirements

4. Collection Calls & Notices

After 10–15 days of delay, lenders begin follow-up calls. If the delay crosses 30 days, you may receive:

Notice for overdue amount
Legal warning (in severe cases)
Recovery agent visits (for repeated misses)

5. Multiple Missed EMIs Lead to Loan Default

If you miss EMIs for 90 days, your loan becomes NPA (Non-Performing Asset). This is extremely serious and impacts credit for 7 years.

How Many Days After Missing EMI Is It Reported?

Delay Days	Impact
1–3 Days	No credit impact, but penalty may apply
4–30 Days	Marked as "Late Payment"
30–90 Days	Reported to credit bureaus, heavy score drop
90+ Days	Loan becomes NPA (High-risk status)

Solutions After Missing an EMI

1. Pay the EMI as Soon as Possible

The earlier you pay, the lower your penalty and credit damage.

2. Request for EMI Rescheduling

Many lenders allow changing the EMI date if salary comes late.

3. Apply for a Loan Refinance

Refinancing reduces EMI load by extending the tenure. You can apply for refinance using:

4. Ask for a Moratorium

In extreme hardship cases, the lender may allow a temporary moratorium on EMIs.

How Loansathi.in Helps When EMI Is Missed

Loansathi.in is one of India’s fastest-growing multi-bank loan service platforms. We partner with 150+ Banks and NBFCs to provide easy financial solutions for every customer type. When someone misses an EMI, we help them regain stability through accurate loan planning.

Loansathi Services Include:

Free loan profile assessment
CIBIL repair guidance
Finding banks/NBFCs that accept low credit score
Providing fresh loan options with flexible EMI
Refinancing support through:

Types of Loans Offered by Loansathi

Final Conclusion

Missing an EMI is not the end of financial stability, but ignoring it can create long-term complications. Penalties, credit score drop, and recovery actions can all be avoided if the borrower immediately takes corrective steps. Loansathi.in helps you understand your situation clearly and provides better loan options to stabilise your finances quickly.