How lenders decide business loan eligibility
Most lenders size a business loan using FOIR(Fixed Obligation to Income Ratio) — the share of your monthly income they'll allow toward all EMIs combined, existing and new. A typical FOIR cap runs 40-65% depending on the lender and your credit profile. Above that cap, an EMI is considered unaffordable regardless of how much collateral or turnover you have.
What the calculator above does
Enter your monthly income, existing EMI obligations, the lender's FOIR cap, an expected interest rate, and desired tenure — the calculator works out the maximum EMI you could take on within that FOIR cap, then converts that EMI into an eligible loan principal at your chosen rate and tenure.
Beyond FOIR: what else affects the real number
FOIR gives a quick estimate, but actual sanctioned amounts also depend on credit score, business vintage, existing banking relationship, and whether the loan is secured or unsecured. Two applicants with identical income and EMIs can get different offers from the same lender based on these factors — treat the FOIR-based number as a starting point for the conversation, not a guaranteed sanction.
If you're also checking a personal EMI against your income, the EMI Calculator and Interest Calculator can help you compare loan structures side by side.