What is a loan management system (LMS)?
A loan management system (LMS) is the software that runs a loan after it is approved. It handles disbursal, the repayment schedule, interest accrual, EMI collection and mandates, DPD tracking and asset classification, collections, and closure. A loan origination system (LOS) covers the part before approval: application, KYC, credit checks and the decision.
LMS woh software hai jo loan approve hone ke baad sab sambhalta hai: disbursal, EMI schedule, byaaj, collection, DPD aur loan closure. LOS approve hone se pehle ka kaam karta hai: application, KYC aur credit check.
LMS vs LOS
| LOS (origination) | LMS (management) | |
|---|---|---|
| Stage | Lead → application → decision | Disbursal → servicing → closure |
| Core jobs | KYC, bureau pull, scoring, documents, sanction | Schedules, accrual, mandates, repayments, DPD/NPA, collections |
| Key outputs | Sanction letter, KFS | Statements, bureau reporting, regulatory returns |
What a modern Indian LMS must do
- Daily, date-exact SMA/NPA classification.
- KFS and APR generated from the same engine as the schedule.
- NACH and UPI AutoPay mandate management.
- Co-lending split ledgers and DLG tracking.
- Collections workflows by DPD bucket, with call and message outreach.
See ZyroAI's Loan Management System.
Common questions
What does a loan management system do?
It runs a loan after approval: disbursal, repayment schedule, interest, EMI collection, DPD tracking, collections and closure.
What is the difference between LMS and LOS?
The LOS handles everything up to the credit decision. The LMS handles the loan from disbursal until it is closed.
Related
ZyroAI products for this: Loan Management System.
Written by the ZyroAI team for people building in Indian BFSI. Regulatory rules change, so for binding requirements check the current RBI, NPCI, UIDAI or relevant regulator circular. Last updated 2026-09-24.