What Is FOIR? How Banks Decide How Much Personal Loan You Get

FOIR stands for Fixed Obligation to Income Ratio. It tells a lender how much of your monthly income is already committed before the new loan.

The formula

FOIR (%) = (existing EMIs + proposed EMI + other fixed obligations) ÷ net monthly income × 100

Fixed obligations include loan EMIs and credit card minimum dues that appear on your credit report. Rent, groceries and utilities are normally not counted.

Worked example

Your net monthly income is ₹60,000 and the lender allows a FOIR of 50%. That means total obligations can reach ₹30,000. If you already pay ₹12,000 in EMIs, your new EMI can be at most ₹18,000.

At 12% interest over four years, an EMI of ₹18,000 supports a loan of roughly ₹6.8 lakh. Change the rate or tenure and the amount changes, so try the FOIR calculator and the EMI calculator together.

What counts as a good FOIR

• Under 40%: comfortable. Lenders usually see you as a low-risk borrower.
• 40 to 55%: acceptable for many salaried applicants at larger companies.
• Above 55%: approval becomes difficult, or the amount is cut down.

How to raise your eligibility

1. Close or prepay small loans and EMI-based purchases.
2. Choose a longer tenure so the EMI is lower (the total interest will rise, so balance both).
3. Add a co-applicant with a steady income.
4. Show additional income, such as rent or a spouse’s salary, where the lender allows it.

Next, read personal loan eligibility in India to see how FOIR fits with score, age and documents.

This article is for general information only and is not financial, legal or tax advice. Interest rates, fees and rules change, so confirm current terms with the lender or the regulator before you decide. Examples use illustrative figures. Last reviewed: October 2026.