A Key Facts Statement is the short document that puts the price of a loan on one sheet: the amount, the rate, the EMI, the tenure, and the charges. People shorten it to KFS. It is meant to be read before you sign, and again before you prepay, because a charge that is real has to be visible there.
Run this on the calculator
EMI Calculator
EMI, total interest and total payment for a home, car or personal loan.
Open calculatorThe Reserve Bank of India (Pre-payment Charges on Loans) Directions, 2025, issued on 2 July 2025, say the applicability of a prepayment charge has to be disclosed in the sanction letter and the loan agreement. Where a Key Facts Statement has to be given, the same fact has to be in that statement. No prepayment charge that was not disclosed this way shall be charged. The Directions apply to loans sanctioned or renewed on or after 1 January 2026. A floating-rate loan to an individual for a non-business purpose has nothing to disclose except that no charge applies. A fixed-rate loan can have a charge, and the sheet is where you see the amount.
Read the sheet against the sanction letter. The rate should name the external benchmark if the loan is a new floating-rate home loan from a bank. The spread should be a number, not a phrase. The EMI on the sheet should match the EMI the schedule produces at that rate and tenure. A processing fee, and any charge for switching to a fixed rate, belongs on the sheet as well. Circular RBI/2023-24/55, updated on 1 October 2025, says charges for switching from floating to fixed, and other service charges for the reset options, have to be disclosed in the sanction letter.
The statement does not decide whether you cut the EMI or the tenure. You still tell the lender. It does tell you whether anyone is allowed to bill you for the privilege. The prepayment guide is the interest maths. The EMI guide is the monthly figure. Neither one is a substitute for the sheet your own lender gave you.
Take a copy before you sign, and another if the lender revises charges later. A verbal assurance that “we do not charge for part-payment” is useful only when the sheet says the same thing. The Directions are clear that an undisclosed prepayment charge cannot be levied. The sheet is how you show it was, or was not, disclosed.
Checked on 3 November 2026. If the sheet you were given is older than a change in charges, ask for the current one before you transfer a lump sum.
Questions
What do I look for before a part-payment?
Whether a prepayment or foreclosure charge is printed, and on what amount. On a floating-rate loan to an individual for a non-business purpose, sanctioned or renewed on or after 1 January 2026, the Reserve Bank says the lender cannot levy that charge. A charge that was never disclosed cannot be added later.
Does the Key Facts Statement replace the sanction letter?
No. The sanction letter and the loan agreement still govern. The statement is the short sheet that has to agree with them. If the three documents disagree on a charge, ask the lender to correct the sheet before you pay.
Where does a switch to a fixed rate get disclosed?
The reset circular, updated on 1 October 2025, says charges for switching from a floating rate to a fixed rate have to be in the sanction letter. The lender may offer that switch under its board policy. It is not a right the updated circular forces on every lender.
Sources
Figures checked 3 Nov 2026.