Some spare money has turned up, and you have decided to repay part of your loan early. Now you have to choose what to reduce: the monthly payment or the term. Check which one your bank applies by default - the difference between them is worth tens of thousands of hryvnias. Let us work out exactly how much.
The example
A 300 000 ₴ loan over 3 years at 36.91 % a year (the average rate on new consumer loans, NBU data for August 2026), annuity. The payment is 13 897 ₴ a month, and the overpayment over the whole term is 200 294 ₴.
After 12 payments the outstanding debt is 233 443 ₴. You have already paid the bank 100 208 ₴ of interest that year, and if nothing changes you will pay another 100 086 ₴ by the end of the term. Now we pay 100 000 ₴ early, and the principal drops to 133 443 ₴.
Two options
| Figure | Reduce the payment | Reduce the term |
|---|---|---|
| Payment | 7 944 ₴ | 13 467 ₴ |
| Left to pay | 24 months | 12 months |
| Interest to the end | 57 212 ₴ | 28 158 ₴ |
| Interest saved | 42 874 ₴ | 71 928 ₴ |
The same 100 000 ₴ saves either 42 874 ₴ or 71 928 ₴. The difference is 29 054 ₴ in favour of the shorter term.
Why the term wins
Interest accrues on the outstanding debt for every month it exists. When you reduce the payment, the debt goes down slowly and keeps "working" for the bank for two more years. When you reduce the term, you keep paying almost as much as before and the debt is gone twice as fast. Fewer months, less interest.
When a lower payment is better
Shortening the term saves more hryvnias, but it is not always the better choice for you.
- You need a buffer. If your income is irregular, a 7 944 ₴ payment instead of 13 897 ₴ leaves 5 953 ₴ a month for an emergency fund
- The money could earn more elsewhere. Interest saved is a 36.91 % annual return, because that is the rate you stop paying. A deposit or government bonds below the loan rate will not beat it (new hryvnia deposits averaged 12.63 % in August 2026, NBU data), so for a 36.91 % loan an early payment is almost always the best investment
No penalty for early repayment
For consumer loans, the Law of Ukraine "On Consumer Lending" lets you repay early, in full or in part, and forbids the bank to charge for it. You pay interest only for the time you actually used the money. Ask your bank how to file the request and from which date the schedule is recalculated.
How to work out your own case
The calculator has no separate button for an early payment, but two steps give the exact result:
- Enter your loan and find the outstanding debt in the schedule after your last payment
- Subtract the early payment and enter the result as a new loan at the same rate. Over the remaining term you will see the new payment; for a shorter term, pick the number of months that keeps the payment close to what you pay now
The method is exact: 233 443 ₴ over 24 months at 36.91 % gives exactly the same 13 897 ₴ payment as the original schedule.
The bottom line
- An early payment cuts the interest either way
- Shortening the term saves more - 71 928 ₴ against 42 874 ₴ in the example
- Reducing the payment makes sense when a monthly buffer matters more
- There is no penalty for repaying a consumer loan early
Run your own numbers in the loan calculator.