How to Prepay Loan Against Securities Without Penalty

If you've taken a Loan Against Securities (LAS), chances are you’re someone who prefers to keep your investments intact while meeting short-term financial needs. That’s a smart move. But what if your situation changes and you want to repay your loan early? The good news is you absolutely can — and in most cases, without any penalties.

At Quicklend, we believe managing your credit should never come with hidden costs or rigid rules. Whether you’re a salaried professional trying to cut down on interest outgo or a business owner looking to clear off dues faster, understanding how LAS prepayment works can help you save significantly.

Key Takeaways

• You can prepay your LAS without incurring penalties.
• Flexible repayment options in LAS help you manage finances efficiently.
• Prepaying your LAS can result in significant interest savings.
• Understand LAS prepayment rules clearly before proceeding.

How Can You Prepay Your LAS Without Penalty?

Prepaying your LAS is simple – but understanding the terms can make all the difference.

LAS Prepayment Rules Explained

Most lenders today, offer LAS with no foreclosure or prepayment charges. This means:

• You can repay the loan in part or in full anytime
• No penalty is charged for early repayment
• Interest is only charged on the outstanding loan amount, not the entire credit line

This is aligned with RBI’s push for borrower-friendly norms (as of 2025).

Steps for Penalty-Free LAS Prepayment

Follow these basic steps to avoid any surprises:

1. Check your agreement: Confirm there are no hidden prepayment clauses.
2. Notify your lender: While not mandatory, giving a heads-up helps with smoother processing.
3. Clear dues online: Most platforms allow online payments via net banking or UPI.
4. Request closure statement: Get a written confirmation for records.

Common Mistakes to Avoid

Even with zero penalties, a few missteps could cost you:

• Ignoring partial prepayment benefit: Even repaying part of your loan reduces daily interest.
• Waiting till month-end: Interest accrues daily – delay adds cost.
• Not reviewing updated interest: If your balance is low, request a recalculation.

What Are the Benefits of Flexible LAS Repayment Options?

Flexibility in repayment is more than just convenience – it can directly impact your financial health.

Interest Savings Through Prepayment

The biggest benefit of flexible LAS repayment is reduced interest cost. Since LAS works like a credit line, interest is charged only on what you use and for how long.

Example:

• ₹3 lakh borrowed for 60 days
• Paid off ₹2 lakh on Day 30
• Interest from Day 31 is only on ₹1 lakh

This alone can save you thousands in interest.

Managing Your Finances with Flexibility

You might get a work bonus or a client payment mid-month. With a flexible LAS, you can:

• Repay early in chunks
• Pause repayment without penalties
• Re-borrow again without reapplying

This keeps your liquidity intact while minimizing cost.

Choosing the Right Repayment Strategy

Every borrower’s goal is different. Here are a few repayment strategies that work well:

• Aggressive: Prepay large chunks early to cut interest
• Balanced: Pay in parts when cash flows allow
• Minimalist: Keep EMIs low and repay when convenient

Quicklend gives you the freedom to switch between these approaches as your situation evolves.

Conclusion

Prepaying your Loan Against Securities can be simple and stress-free — as long as you choose a lender that offers flexibility and no hidden penalties.

Whether you're planning to close your LAS early or just manage your repayments better, make sure you're working with a platform that puts your financial convenience first.

This is general guidance. For personalized loan advice, speak to a financial advisor.