i am taking a bank loan for paying partial payment to my supplier. Bank told instead of giving me the amount, they will directly pay to the supplier on my behalf.

Thanks for posting in this forum, Mir.

You can record this transaction in QuickBooks Online using a journal entry to ensure both the payment to the supplier and the loan liability are accurately tracked in your books. Let me show you how. 

Before we proceed, have you already created a bill in QuickBooks for the supplier payment? If so, we can start by setting up a loan liability account to help you track the loan balance while also recording the supplier payment made by the bank.

Once done, let’s create a journal entry to properly reflect the payment made. To do so, here’s how:

1. Click + Create, then select Journal entry.
2. On the first line, select Accounts Payable (AP) and enter the amount in the debit column.
3. On the next line, select the Loan Liability account you created and add an amount in the credit column.
4. Ensure the debit and credit amounts are equal to balance the entry.
5. Add the other necessary information.
6. Once done, select Save and close.

Creating this journal entry will decrease Accounts Payable, reducing the bill amount and vendor balance, and increase the loan liability account, which reflects the debt tied to the payment made by the bank.

To pay back the loan to the bank, you can record this in QuickBooks using an expense or cheque transaction. Then, select the Loan Liability account as the category for the payment to ensure the loan balance decreases accordingly.

On the other hand, if you’re unsure about using journal entries or want to explore alternative methods, I recommend consulting with your accountant for guidance. They can help ensure the transaction is recorded accurately and aligned with your financial setup.

You’re always welcome to post in this forum if you need further help. We’re glad to assist you.