diff --git a/erpnext/loan_management/doctype/loan/test_loan.py b/erpnext/loan_management/doctype/loan/test_loan.py
index da05c8e..2608e42 100644
--- a/erpnext/loan_management/doctype/loan/test_loan.py
+++ b/erpnext/loan_management/doctype/loan/test_loan.py
@@ -1042,6 +1042,7 @@
 				"company": "_Test Company",
 				"loan_name": loan_name,
 				"is_term_loan": is_term_loan,
+				"repayment_schedule_type": "Monthly as per repayment start date",
 				"maximum_loan_amount": maximum_loan_amount,
 				"rate_of_interest": rate_of_interest,
 				"penalty_interest_rate": penalty_interest_rate,
diff --git a/erpnext/patches.txt b/erpnext/patches.txt
index 2a0ca8c..379b7fe 100644
--- a/erpnext/patches.txt
+++ b/erpnext/patches.txt
@@ -315,3 +315,4 @@
 erpnext.patches.v14_0.create_accounting_dimensions_in_subcontracting_doctypes
 erpnext.patches.v14_0.fix_subcontracting_receipt_gl_entries
 erpnext.patches.v14_0.migrate_remarks_from_gl_to_payment_ledger
+erpnext.patches.v13_0.update_schedule_type_in_loans
diff --git a/erpnext/patches/v13_0/update_schedule_type_in_loans.py b/erpnext/patches/v13_0/update_schedule_type_in_loans.py
new file mode 100644
index 0000000..e5b5f64
--- /dev/null
+++ b/erpnext/patches/v13_0/update_schedule_type_in_loans.py
@@ -0,0 +1,14 @@
+import frappe
+
+
+def execute():
+	loan = frappe.qb.DocType("Loan")
+	loan_type = frappe.qb.DocType("Loan Type")
+
+	frappe.qb.update(loan_type).set(
+		loan_type.repayment_schedule_type, "Monthly as per repayment start date"
+	).where(loan_type.is_term_loan == 1).run()
+
+	frappe.qb.update(loan).set(
+		loan.repayment_schedule_type, "Monthly as per repayment start date"
+	).where(loan.is_term_loan == 1).run()