If the loan is not repaid, the bank or NBFC can take legal action against you. In this, action can be taken like sending recovery notice, court case, attachment of property. If the loan is secured, such as a home, auto or gold loan, the bank can collect a loan by selling mortgaged property. It also has an impact on credit score. Your credit score falls from the loan default. This means that expensive loans in future can be difficult to take insurance or get jobs.
