Personal Finance Term
DSR
Debt Service Ratio
The percentage of your monthly income that goes toward servicing all debt repayments. Most Malaysian banks cap loan approval at a DSR of 60–70% depending on income level.
DSR = (Total monthly debt repayments ÷ Net monthly income) × 100. If you earn RM5,000/month and have RM2,000 in existing loan repayments, your DSR is 40%. Adding another RM1,500/month loan would push DSR to 70% — at the upper limit for most banks.
Higher income earners generally qualify for a higher DSR threshold. Some banks use gross income; others use net income after EPF. Existing commitments — car loans, personal loans, credit card minimum payments — all count toward DSR even if you pay more than the minimum each month.