It could be argued that there may be changes in the nature of the credit channel of monetary policy, which can be divided into a “bank lending” and a “borrower balance sheet” channel. The nature of the traditional bank lending channel is probably changing progressively owing to technological innovations, which have significantly enhanced the ability of banks to grant credit.
However, it is still too early to assess in what way this channel may be affected. The so-called borrower balance sheet channel focuses, instead, on the impact which changes in the policy rate have on the premium between external and internal finance.