Lesson 3 · Practitioner · Both · 14 min
Disbursement, EMI & Amortization
Book money out correctly, then understand how EMI splits principal and interest over time — including day-count quirks in discount products.
Objectives
- ▸List disbursement controls (beneficiary validation, maker-checker)
- ▸Explain reducing-balance EMI amortization intuitively
- ▸Contrast EMI amortizing loans with discount/bullet SCF structures
- ▸Identify fee/tax deductions that change net disbursed
Disbursement executes the credit decision as a funds movement: validate beneficiary account (penny drop), confirm conditions precedent, compute net amount after fees, and push via NEFT/RTGS/IMPS or internal GL. Maker creates; checker approves — especially in SCF LMS where invoice math and FX rates can move.
- Unique drawdown / disbursement IDs for idempotency
- Capture UTR and status for recon
- Partial disbursement rules must be explicit
Key terms
DisbursementNet disbursedEMIAmortizationPrincipal outstandingDay-countDiscount feeBullet repaymentGrace days