A key point in this context for the banks is that they cannot afford to outsource their responsibility of credit appraisal which is a basic function to a third party. Lending is the most critical of banks’ functions and that cannot be outsourced. BIS central bankers’ speeches  3  •  Pricing of loans does not always follow the corresponding rating.
Similarly, the computation of Base Rate by the banks has not been found to be very scientific and transparent. •  Often the smaller borrowers allege bias by banks in favour of corporate entities in matters of lending. An oft heard grievance from SME borrowers is the insistence on collaterals where it is neither mandated nor necessary.