diff --git a/bank.py b/bank.py
index ab74f6f..f766662 100644
--- a/bank.py
+++ b/bank.py
@@ -45,9 +45,40 @@ def calculate_total_assets(self):
         pass
 
     
-    def process_loan_payments(self):
-        # Processes loan payments by deducting the installment amount from the balance.
-        pass
+    def process_loan_payments(self):
+        # Processes loan payments by deducting the installment amount from the balance.
+        processed_payments = []
+
+        for loan in self.loans:
+            if loan.tenure <= 0 or loan.remaining_balance <= 0:
+                continue
+
+            account = next(
+                (account for account in self.accounts if account.account_number == loan.account_number),
+                None,
+            )
+
+            if account is None:
+                continue
+
+            installment = min(loan.amount / loan.tenure, loan.remaining_balance)
+
+            if account.balance < installment:
+                continue
+
+            account.balance -= installment
+            loan.remaining_balance -= installment
+
+            payment = {
+                "loan_id": loan.loan_id,
+                "account_number": account.account_number,
+                "amount": installment,
+            }
+            account.transactions.append(("Loan Payment", installment))
+            self.transactions.append(payment)
+            processed_payments.append(payment)
+
+        return processed_payments
 
 
 class Account:
diff --git a/test_bank.py b/test_bank.py
new file mode 100644
index 0000000..b6f21c6
--- /dev/null
+++ b/test_bank.py
@@ -0,0 +1,57 @@
+import unittest
+
+from bank import Account, Bank, Loan
+
+
+class ProcessLoanPaymentsTest(unittest.TestCase):
+    def test_processes_installment_from_matching_account(self):
+        bank = Bank("RepoRaid Bank")
+        account = Account(101, "Ada", 500.0)
+        loan = Loan(1, 101, 1200.0, 0.05, 12)
+        bank.accounts.append(account)
+        bank.loans.append(loan)
+
+        payments = bank.process_loan_payments()
+
+        self.assertEqual(
+            payments,
+            [{"loan_id": 1, "account_number": 101, "amount": 100.0}],
+        )
+        self.assertEqual(account.balance, 400.0)
+        self.assertEqual(loan.remaining_balance, 1100.0)
+        self.assertEqual(account.transactions, [("Loan Payment", 100.0)])
+        self.assertEqual(bank.transactions, payments)
+
+    def test_caps_payment_at_remaining_balance(self):
+        bank = Bank("RepoRaid Bank")
+        account = Account(202, "Grace", 75.0)
+        loan = Loan(2, 202, 1200.0, 0.05, 12)
+        loan.remaining_balance = 40.0
+        bank.accounts.append(account)
+        bank.loans.append(loan)
+
+        payments = bank.process_loan_payments()
+
+        self.assertEqual(
+            payments,
+            [{"loan_id": 2, "account_number": 202, "amount": 40.0}],
+        )
+        self.assertEqual(account.balance, 35.0)
+        self.assertEqual(loan.remaining_balance, 0.0)
+
+    def test_skips_missing_accounts_and_insufficient_funds(self):
+        bank = Bank("RepoRaid Bank")
+        low_balance = Account(303, "Linus", 25.0)
+        unpaid = Loan(3, 303, 1200.0, 0.05, 12)
+        missing_account = Loan(4, 404, 1200.0, 0.05, 12)
+        bank.accounts.append(low_balance)
+        bank.loans.extend([unpaid, missing_account])
+
+        self.assertEqual(bank.process_loan_payments(), [])
+        self.assertEqual(low_balance.balance, 25.0)
+        self.assertEqual(unpaid.remaining_balance, 1200.0)
+        self.assertEqual(missing_account.remaining_balance, 1200.0)
+
+
+if __name__ == "__main__":
+    unittest.main()