How often are interest payments due on a demand loan?

The frequency of interest payments on a demand loan is typically determined by the loan provider's policies and the applicant's agreement:

• For most demand loans, interest payments are usually made by applicants on a monthly basis. This means applicants pay the interest that has accrued over the previous month at the end of each month.
• Some financial institutions offer more flexibility in payment timelines. For certain applicants who need less frequent payments, loan providers may allow interest repayment quarterly—once every three months. This arrangement helps align with cash flow cycles.
• While less common, a few lenders might also permit applicants to pay the interest annually or semi-annually, particularly for loans structured for specific financial situations.
• Additionally, loan providers sometimes create customised payment schedules for individual applicants based on their financial profiles. Businesses or high-value customers often have the option for tailored interest repayment timelines.
• In certain cases, mostly involving very short-term loans, the applicant could pay all the accrued interest along with the principal outstanding when the bank or Non-banking Financial Companies (NBFCs) demand repayment of the loan.