diff --git a/erpnext/loan_management/doctype/loan_repayment/loan_repayment.py b/erpnext/loan_management/doctype/loan_repayment/loan_repayment.py
index 6a6eb591629..6362d45681b 100644
--- a/erpnext/loan_management/doctype/loan_repayment/loan_repayment.py
+++ b/erpnext/loan_management/doctype/loan_repayment/loan_repayment.py
@@ -279,9 +279,9 @@ class LoanRepayment(AccountsController):
 
 		if interest_paid > 0:
 			if self.penalty_amount and interest_paid > self.penalty_amount:
-				self.total_penalty_paid = self.penalty_amount
+				self.total_penalty_paid = flt(self.penalty_amount, self.precision("debit"))
 			elif self.penalty_amount:
-				self.total_penalty_paid = interest_paid
+				self.total_penalty_paid = flt(interest_paid, self.precision("debit"))
 
 			interest_paid -= self.total_penalty_paid