A loop distribution system is mostly preferred in the distribution network rather than the radial one for reliable power and satisfaction of the customerswith comparably less power loss. This paper proposes a method to achieve line loss minimization by installing a “Sen” Transformer (ST) in a loopdistribution system. An ST works as a series voltage regulator or impedance regulator in the loop distribution system to address power quality issues withbetter economic impact by inserting the compensating voltage or virtual impedance in the line. In the present work, the use of an ST is proposed in theloop distribution system with two different control schemes for balanced power flow with a reduction in line loss. The total minimization in line loss canbe obtained if the summation of the all voltage drop across the line inductor in the loop distribution system tends to be zero. The total reduction in lineloss can be realized by installing the ST in the line that eliminates the circulating current by injecting the compensating voltage. Validation of the presentwork has been done by the simulating loop distribution system with an ST and the loop current is eliminated to address the line loss minimizationproblem with two different control schemes, line voltage compensation scheme (LVCS) and line inductance compensation scheme (LICS).