How to Ask Your Bank to Reduce or Restructure Your EMIs

Illustration: a written request letter, a schedule where tall EMI bars become shorter and spread over more months, and a calendar showing a longer tenure — A lower EMI over a longer tenure eases monthly pressure — but usually costs more interest overall.

Quick answer

If your income has fallen but you can still pay something every month, ask your lender — in writing and before you default — for a change to the repayment terms. Common options are a longer tenure (lower EMI), a short moratorium or reduced EMIs for a few months, or a formal restructuring. For floating-rate EMI loans, RBI rules also require lenders to offer, at interest-rate reset, the choice of a higher EMI, a longer tenure, or a switch to a fixed rate. Your letter should explain what changed, show your current income and expenses, and propose an EMI you can sustain. The lender decides under its board-approved policy, and a restructured account may be reported as such to credit bureaus.

A pay cut, a medical emergency or a slow business season can make an EMI that was comfortable last year impossible today. Many borrowers wait until they have already missed payments before speaking to the lender — by which point the account may be overdue, charges are rising and options have narrowed. Asking early, in writing, with a clear and realistic proposal is the single most useful thing you can do.

When to ask

As soon as you see the problem coming — ideally before the first missed EMI.
When the hardship is real but temporary or partial — you can pay something, just not the full EMI.
Before the account is overdue for long. Lenders track overdue accounts in stages; an account overdue for more than 90 days is generally classified as an NPA. See what happens after 90 days.

If you cannot pay anything at all for the foreseeable future, a restructuring may not fit and a settlement may be discussed instead; read settlement vs restructuring.

Options you can ask for

Option	What it does	Good to know
Tenure extension	Spreads the outstanding over more months, lowering each EMI.	Total interest paid usually goes up.
Temporary moratorium / step-up EMIs	Lower or no EMIs for a few months, then normal or higher EMIs.	Interest usually continues to accrue during the relief period.
Formal restructuring	Changes the loan terms (tenure, schedule, sometimes rate) under the lender's restructuring policy.	May be reported to credit bureaus as restructured.
Floating-rate reset choices	At a rate reset, choose a higher EMI, longer tenure, or switch to fixed rate; prepay any time.	Required by RBI for EMI-based floating-rate personal loans.
Balance transfer / consolidation	Move the loan to another lender at a lower rate.	Needs a reasonable credit profile; check fees.

What to put in your request letter

Address the letter or email to your branch or the lender's customer service, and keep a copy. Include:

Your name, loan account number and contact details.
What has changed — job loss, salary cut, illness, business downturn — and since when.
Your current monthly income and essential expenses, and the EMIs of any other loans.
A specific proposal — for example, "I can pay ₹X per month for the next six months, then return to the full EMI", or "please extend the tenure so the EMI is about ₹X".
Supporting documents — termination or salary letter, medical bills, bank statements, GST returns for a business.
A request for a written reply and for the revised terms in writing if approved.

Never share OTPs, PINs or passwords while making the request, and correspond only through the lender's official channels.

Trade-offs to understand

More total interest. A lower EMI over a longer period almost always costs more overall. Ask for the revised schedule and total payable.
Credit reporting. A restructured account can be flagged in your credit report and may affect new borrowing for a while — usually less severely than a default or settlement.
Conditions. Some restructurings come with conditions, such as maintaining salary credit with the lender or paying charges. Read them before agreeing.
Stick to it. Missing the revised EMIs can undo the benefit quickly. Choose an EMI you can genuinely pay.

Use our settlement and budget calculator to see what monthly amount your budget can realistically support.

If the lender says no

Ask for the reason in writing and whether a different proposal could be considered.
Escalate to the lender's grievance redressal officer if you believe your request was not properly considered or you received no reply.
If there is no satisfactory reply within 30 days, you may complain to the RBI Ombudsman about deficiency in service (the decision to restructure itself remains the lender's).
Keep paying what you can and keep records — part-payments with a written explanation are better than silence.

Frequently asked questions

Yes. You can request a longer tenure, temporary relief or a restructuring in writing. The lender will assess it under its own policy; approval is not automatic, so explain the change in your circumstances and propose an EMI you can sustain.

A restructured account may be reported as restructured, which can affect new credit applications for some time. It is generally less damaging than missed payments, a default or a settled status, especially if you pay the revised EMIs on time.

There is no general, automatic EMI relief scheme for individual borrowers at present. Each lender considers requests under its board-approved policy. For floating-rate EMI-based personal loans, RBI rules require lenders to offer the choice of a higher EMI, a longer tenure or a switch to a fixed rate at reset.

No. Deliberately stopping payments increases charges, harms your credit report and can lead to legal action. Ask for relief early, and pay what you can while the request is considered.

References

Reserve Bank of India — Reset of floating interest rate on equated monthly instalment (EMI) based personal loans (RBI/2023-24/55, 18 August 2023): rbi.org.in
Reserve Bank of India — Prudential Framework for Resolution of Stressed Assets (7 June 2019): rbi.org.in
Reserve Bank of India — Complaint Management System: cms.rbi.org.in