Banks could soon lose some of their freedom to fix lending rates.
To ensure that lending rates are more sensitive to changes in monetary policy rates, the Reserve Bank of India on Tuesday issued draft guidelines, prescribing a uniform method by which banks will have to arrive at interest rates for loans. Although the proposed move could ring in transparency in the pricing of loans, banks are expected to oppose it.
On its part, the RBI said it will encourage banks to move, in a time-bound manner, to the so-called marginal cost of funds-based determination of minimum lending rates.

Source - http://www.thehindubusinessline.com