It currently has an outstanding balance of £7.7m to pay between now and 2045 - 30 years after the first trains ran between Tweedbank and Edinburgh.
However, it has now agreed to borrow money to pay off the balance in a move estimated to save about £4.3m.
Council leader David Parker said it would reduce the burden on local tax payers.
He said the local authority had access to very low rates on its borrowing.
"When officers have looked very carefully at the financial issues around it, it makes sense to make that saving," he said.
"That is exactly what we will be doing now.
"For future councils we are reducing the revenue burden on them and making sure that the railway contribution is paid."
Scottish Borders Council has agreed a move to cut the overall cost of its contribution to the Borders Railway.