FOIRFixed Obligation to Income Ratio
FOIR is the share of a borrower's net monthly income committed to fixed obligations, including the EMI of the loan being applied for. Indian lenders typically sanction retail loans within a FOIR of 50-65%.
It is calculated as (existing monthly obligations + proposed EMI) / net monthly income x 100. Credit card balances are usually counted at a notional 5% of the outstanding rather than in full.
FOIR sits beside the bureau score as the two numbers that decide most retail loan eligibility. Checking it at sourcing rather than at credit stage is the single cheapest way to reduce rejections.
Full guide: FOIR explained with worked examples