AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
Your debt-to-income ratio is your total monthly debt repayments divided by your monthly income, shown as a percentage. Many Nigerian banks cap a new loan's repayment at about a third of net monthly pay: Sterling Bank, for example, lists 33.3% of net monthly salary for its payroll loan (checked October 2026). Below that line you have some room; above it, most lenders will offer less or decline.
Lenders in Nigeria look at many things before offering credit, including your credit bureau record and how your account is run. One of the simplest, and the one you can check yourself in two minutes, is how much of your income already goes on repayments. Knowing your number before you apply saves you from offers you cannot carry, and shows you how much room you have.
The formula
Debt-to-income ratio = total monthly debt repayments ÷ monthly income × 100.
- Debt repayments: every regular repayment: bank loans, loan apps, pay-later instalments, cooperative deductions, car loans, the minimum on any credit card, salary advances.
- Income: most Nigerian bank tests use net monthly pay, after tax, pension and other statutory deductions. For the self-employed, lenders often look at average monthly turnover or inflows instead.
Do not include everyday bills such as rent, school fees or electricity in the debt figure for this ratio, although lenders may look at them separately and you should certainly count them in your own budget.
Worked example
Labelled example. Chiamaka's net monthly pay is ₦400,000. She repays ₦60,000 a month on a bank loan and ₦40,000 a month on a pay-later plan.
- Total monthly repayments: ₦60,000 + ₦40,000 = ₦100,000.
- Ratio: ₦100,000 ÷ ₦400,000 × 100 = 25%.
- Room under a 33.3% cap: ₦400,000 × 33.3% = ₦133,200; ₦133,200 − ₦100,000 = ₦33,200 a month for any new repayment.
If Chiamaka wanted a new loan with an instalment of ₦50,000, her ratio would be ₦150,000 ÷ ₦400,000 = 37.5%, above a one-third cap. A lender applying that rule would likely offer a smaller amount or a longer tenor so the instalment fits.
What lenders actually use
There is no single national figure; each lender sets its own policy. Sterling Bank's public loans page (checked October 2026) gives a useful view of how one bank applies the idea:
| Sterling product (as listed, Oct 2026) | Repayment cap stated |
|---|---|
| Payroll personal loan | 33.3% of net monthly salary (40% of annuity inflow for annuitants) |
| Vehicle and asset finance | 33.33% for this loan; total obligations capped at 50%, 40% or 33.33% by employer category |
| Home finance (salaried) | 33.3% of net monthly income |
| SME Business Support Facility | Up to 50% of average monthly turnover |
The one-third rule many people quote comes from figures like these. For digital lenders, the FCCPC's 2025 consumer lending regulations require lenders to assess a consumer's capability to repay before granting credit, without setting a ratio. Check each lender's own terms.
Income that varies
If your income changes month to month, as it does for traders, freelancers and commission earners, use a cautious figure: the average of your lowest three months in the past year rather than the overall average. A ratio that looks fine in a good month can become unmanageable in a slow one. Lenders assessing the self-employed often look at turnover over a full year for the same reason; Sterling's home finance terms, for instance, refer to average monthly turnover over 12 months for business owners.
What a healthy ratio looks like
- Under 20%: repayments take a modest share of income; you have space for savings and emergencies.
- 20% to 33%: manageable for most households if income is steady, but leaves less room for shocks.
- Above 33%: many bank tests would decline new borrowing; a fall in income could make repayments hard to keep up.
- Above 50%: half your pay is committed before rent, food and transport. Consider clearing debts before taking more.
These bands are a general guide, not a rule. A household with low rent and stable income can carry more than one with high fixed costs. Recalculate your ratio whenever a loan ends, a new one starts or your pay changes, so the number you act on is current.
How to bring your ratio down
- Clear the smallest balances first to remove whole repayments, or the most expensive first to save interest; either cuts the ratio.
- Avoid stacking short loan-app loans, which carry large repayments relative to the amount.
- Ask your bank about a longer tenor or restructuring, accepting that a longer tenor usually costs more in total.
- Do not take a new loan to meet an old one's repayment; see how to clear multiple loan apps.
To turn the ratio into a loan size, see how much loan you can afford on a ₦150,000 salary, and for how lenders view your history, credit scores in Nigeria.
Where Pryme fits
Your Pryme Personal Assistant can help you keep track of repayment dates and set reminders, preparing everything for your approval. Loans on Spaces limits from Solid Allianze MFB are offered based on how your account is run and shown in full before you accept.
Questions people ask
How do I calculate my debt-to-income ratio?
Add up all your monthly loan and credit repayments, divide by your net monthly income and multiply by 100.
What percentage of my salary can go to loan repayment in Nigeria?
Many banks cap it at about a third of net monthly pay. Sterling Bank, for example, lists 33.3% for its payroll loan. Each lender sets its own policy.
Does rent count in debt-to-income ratio?
Usually not as debt, but lenders may consider it separately, and you should include it in your own budget.
Can I get a loan if my debt-to-income ratio is high?
You may be offered a smaller amount or longer tenor, or be declined. Reducing existing repayments first improves your chances and your cash flow.
Sources
- Sterling Bank: Loans (payroll, vehicle, home and SME loan terms) · accessed Oct 2026
- FCCPC: Digital, Electronic, Online, or Non-Traditional Consumer Lending Regulations, 2025 (made 21 July 2025) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.