See how much of your income goes to debt

Debt Service Ratio (DSR)

Calculate your Debt Service Ratio (DSR) — the metric Malaysian banks use to assess loan affordability — from your income and debt commitments.

Formula

DSR = total monthly debt commitments ÷ net monthly income

Assumptions

• Most banks prefer a DSR at or below 60-70%, with under 40% considered comfortable — exact thresholds vary by bank and individual credit profile.
• Net monthly income should be take-home pay after EPF, SOCSO, and income tax, not gross salary.
• Excludes some items certain banks also count, like guarantor obligations or unutilized credit card limits.

Frequently asked questions

What's a good DSR?
Generally, under 40% is considered comfortable, and above 60-70% starts to concern most banks — but every bank sets its own threshold, and some approve up to 80% depending on your overall credit profile.

Does DSR include the new loan I'm applying for?
Yes — banks calculate DSR including the new loan's monthly payment, not just your existing commitments, since that's what determines whether you can actually afford it.

Why do banks reject applicants with a high DSR?
A high DSR means most of your income is already committed to debt repayments, leaving little buffer for unexpected expenses or a new loan — banks see this as a higher risk of default.

Sources

• Bank Negara Malaysia — Responsible financing and affordability assessment