Chart of Accounts for a Lending Company: A Complete Template

The chart of accounts is the backbone of your books. It is the master list of every "bucket" you can post a transaction to, organized so that your financial statements assemble themselves. For a lending company, a generic small-business COA won't do — you need accounts that capture the specific way money moves in and out of a loan portfolio. This template gives you a clean starting point.

The five account types

Every account belongs to one of five families, and their order in the COA mirrors your financial statements: assets and liabilities and equity form your balance sheet, while income and expenses form your income statement.

The accounts a lender actually needs

Here is a practical chart of accounts tuned for a Philippine lending company. The account codes are a common convention — 1000s for assets, 2000s for liabilities, 3000s for equity, 4000s for income, 5000s for expenses — but the important thing is the accounts themselves.

Why the lending-specific accounts matter

Three accounts do the heavy lifting for a lender. Loans Receivable holds the principal your borrowers owe — it is often your single largest asset. Interest Income captures what you earn as loans accrue and get paid. And Loans Payable records money you yourself have borrowed to fund lending. Separating Penalty Fees and Service & Processing Fees from interest is not just tidy — it matters for tax, because these income streams can be treated differently, and examiners expect to see them broken out.

Keep principal (Loans Receivable) and the income it generates (Interest Income) in separate accounts. Mixing them is the classic beginner mistake that makes a portfolio impossible to audit.

Tax and compliance accounts

A lender also needs liability accounts that a trading business rarely touches. Withholding Tax Payable holds EWT you deducted from vendors until you remit it. DST Payable accumulates documentary stamp tax on loan releases until you file BIR Form 2000. Having these as standing accounts means your monthly and quarterly tax figures are simply account balances — no reconstruction required.

Contra accounts and subsidiary ledgers

Two refinements make a lender's COA genuinely audit-ready. The first is the contra account, most importantly the Allowance for Doubtful Accounts. It sits against Loans Receivable and carries a credit balance, reducing the net value of your portfolio to what you realistically expect to collect. Without it, your balance sheet overstates your assets by pretending every loan will be repaid in full — which no examiner believes. The allowance is grounded in your loan aging, so the two systems reinforce each other.

The second is the subsidiary ledger. Loans Receivable in the general ledger is a single control figure, but behind it must sit a loan-by-loan record — each borrower, principal, and outstanding balance — that sums exactly to the control account. This subsidiary ledger is what lets you answer "how much does borrower Santos still owe?" instantly, and it is the first thing an auditor reconciles against your control balance. A COA that anticipates both the allowance and the subsidiary ledger is one you will never have to restructure later.

Let your accounts do the reporting

A well-designed COA is what makes month-end painless. Your trial balance, income statement, and balance sheet all assemble from these accounts automatically, and your BIR returns pull from the same source. In LendKoPH, this exact chart of accounts is built in and every loan and collection posts to the right account by itself — so your books are structured correctly from your very first entry, and your auditor thanks you at year-end.