Banks, NBFCs, and digital lending institutions across emerging markets struggle with a persistent problem:
need to automate journal entries in ERP for every loan repayment, settlement, fee, tax, restructuring event, or write-off.
These delays not only slow down financial close cycles but also create inconsistencies between the Loan Management System (LMS), Core Banking System (CBS), and the ERP/General Ledger (GL).
FinFloh solves this through a seamless automation-driven layer that updates the ERP instantly and accurately—eliminating spreadsheets, manual mapping, version errors, and reconciliation chaos.
Table of Contents
Why Automating Loan Journal Entries Matters for Banks & NBFCs
1. Manual Workloads Slow Down Accounting Teams
Whether it’s a bank with a large loan portfolio or an NBFC managing thousands of accounts, accounting teams often receive repayment files from collections, settlement teams, field agents, or recovery partners.
Each file must be decoded, split into principal/interest components, and then manually entered into the ERP.
This takes time, introduces mistakes, and creates audit issues at the end of every month.
2. Delayed Updates Impact Financial Accuracy
For both banks and NBFCs, if repayments or settlements aren’t reflected immediately in the ERP/GL:
- Loan balances remain outdated
- Interest income reporting becomes inaccurate
- Provisioning, impairment, and NPA calculations get distorted
- Month-end close becomes a fire-drill
3. Lack of Integration Between LMS and ERP
Most banks and NBFCs operate multiple systems—CBS, LMS, payment gateways, ERP—but they rarely speak to each other in real time.
FinFloh becomes the intelligent layer connecting all these systems through event-based automation, ensuring financial data moves without noise or delays.
How FinFloh Automates Journal Entry Updates in ERP
Event-Based Automation for Repayments, Settlements & More
FinFloh supports event-driven accounting, meaning it can generate or trigger JE updates for:
- Repayments & part-payments
- Settlements & negotiated closures
- Prepayments
- Restructuring or rescheduling
- Write-offs & NPA reclassification
- Disbursals (when integrated deeply with LMS/CBS)
This covers the full lending lifecycle for both banks and NBFCs.
Identifies Principal, Interest, Fee & Tax Automatically
FinFloh reads every repayment and intelligently breaks it down into:
- Principal
- Interest
- Fees
- Taxes (VAT, stamp duty, administrative charges, etc.)
Each component is mapped to the correct GL chart, cost center, product code, or branch, based on how the bank or NBFC has configured its policies.
Instant Reflection of Repayments in ERP
When a borrower pays online, through self-service channels, or via field agents:
- The event is captured instantly inside FinFloh
- The accounting logic is applied automatically
- DR/CR entries are generated based on configured rules
- The final JE is pushed to the ERP immediately
No batching, uploads and spreadsheets
Just real-time, accurate accounting for both banks and NBFCs.
Plug-and-Play Integration Across Systems
FinFloh integrates cleanly with:
- LMS / CBS
- SAP
- Oracle Financials
- Microsoft Dynamics 365
- NetSuite
- Zoho Books
- Tally
It also works with multi-entity setups and supports IFRS + local GAAP — essential for regulated financial institutions.
Complete Audit Trail, Approvals & Policy Control
FinFloh provides:
- Maker-checker approval workflows
- JE logs with timestamps and user attribution
- GL tagging (product, branch, cost center, business segment, DPD bucket)
- Version-controlled accounting rules
- Full audit trail for every accounting event
Perfect for compliance-heavy banking and NBFC environments.
What Banks and NBFCs Gain With FinFloh’s ERP Automation
1. Zero Manual Journal Entry Work
Teams eliminate repetitive tasks that previously consumed hours daily.
2. Real-Time Loan Book Accuracy
ERP reflects the true loan position immediately — not hours or days later.
3. Faster Month-End Close
With accurate splits and clean entries, accounting teams avoid messy reconciliations.
4. Stronger Compliance & Governance
Automated audit trails and structured GL posting improve governance across branches and entities.
Differentiator: What Makes FinFloh Unique?
FinFloh is the only loan collections platform that connects every repayment, settlement, dispute, restructuring, and write-off action directly to the ERP—automatically generating clean, GAAP-compliant journal entries with zero manual effort.
For banks and NBFCs, this is a true end-to-end collections + accounting automation layer in one product.
Conclusion
Manual accounting is one of the biggest hidden inefficiencies inside lending operations.
FinFloh eliminates this by bringing intelligence, integration, and automation into a single, cohesive workflow. FinFloh combines the Automated Loan Journal Entry in ERP with Collections and Payment Mapping features to provide an end-to-end solution for Banks and NBFCs.
To explore how your bank or NBFC can modernize loan operations and financial accuracy, visit the FinFloh website or Talk to our experts.
