Debt Restructuring · Question

Should I keep paying partial amounts while restructuring is being discussed?

Short answer

Generally yes, if the amount is one the business can sustain without starving operations. Regular part payments show good faith, limit how fast dues grow, and give the lender a reason to keep negotiating. They are not a legal shield and do not promise approval. Pay what is realistic, and record in writing how the lender will apply each payment.

In more detail

When a borrower goes silent and pays nothing, the lender sees a risk growing in the dark. When a borrower pays a modest, steady amount and keeps the conversation going, the lender sees someone trying. That difference in perception often shapes how patient the lender is.

Work from your actual cash flow, not from the instalment you wish you could pay. The test is whether you can pay the same amount again next month without borrowing from suppliers or skipping wages and statutory dues. A smaller amount paid reliably does more good than a large payment followed by silence.

Tell the lender that the payment is made without prejudice to the pending request.
Ask how it will be appropriated, whether first to overdue interest or to principal.
Keep proof of every transfer and ask for the lender's acknowledgement.
Do not promise a schedule in the conversation that your projections cannot support.

A trading firm with delayed collections

A distributor cannot meet the full instalment while a key customer delays payment. It agrees internally to pay a fixed modest sum on the same date each month, sends a short covering note each time, and keeps the lender informed of collections. The lender sees consistency, which supports further discussion.

Do not favour one lender over others in a way that hurts relations, and do not pay from funds meant for taxes or wages. If even a part payment is impossible for a period, say so early and explain why rather than letting the account go quiet.

Key points

Steady, sustainable part payments signal good faith and slow the build-up of dues.
Size the amount from real cash flow and aim to repeat it every month.
Record that payments are without prejudice and ask how they are applied.
Never fund part payments from statutory dues or wages.
Part payments do not promise approval or stop the lender's rights.

Who this applies to

Borrowers in arrears who are waiting for a restructuring decision.
Promoters deciding between paying nothing and paying something while talks run.
Finance heads managing cash across several lenders at once.

Last reviewed 3 October 2026

This answer is general information, not advice on your particular case. Terms, eligibility, and requirements change, so check the current position with the relevant institution or authority. Lalsar Holdings' financial advisory and financing work is advisory and facilitation only. Lalsar Holdings is not a lender. Sanction and disbursement of any credit facility is at the sole discretion of the partner bank, NBFC, or financial institution involved, subject to their own eligibility criteria and credit policy.