Source: French to English Tester Published on: 2026-04-27
Source: The Conversation – France (in French)– By Sarah Maire, Assistant Professor in Accounting and Control, Ph.D., IÉSEG School of Management
The credit conditions granted to businesses do not depend solely on quantitative data. Some client managers rely on more qualitative factors and consult their colleagues before making decisions. Bank management should address this issue to try to correct disparities that are difficult to quantify.
Two companies with similar financial profiles should obtain the same credit conditions. Otherwise, what factors would explain different conditions from one company to another if these two companies represent the same risk?
If the evaluation of a loan application is based on an objective procedure established by the bank, how can such a situation occur?
The influence of colleagues
One of the avenues considered in our studyfocuses on the influence of credit officers’ colleagues within the same business center and raises the following question: how, through a discussion between two credit officers, does the final decision become altered according to the opinion of one’s office neighbor? Successfully identifying such influence is crucial to understanding the resulting financing inequalities and thus considering a change in banking practices.
When requesting financing from the bank, the company must provide a number of pieces of information and documents so that the credit officer can analyze the project to be financed and the financial situation of their client, while taking into account the economic context. The decision to grant or not grant a loan and its conditions is not easy: what loan amount to authorize? At what rate?
The share of “feeling”
These decisions are based not only on numerical data such as its financial rating or its turnover, called quantitative information, but also on a significant part of human judgment based, among other things, on the feeling during meetings, the duration of the relationship between the bank and the company, or themastery of the languageof the borrower, called qualitative information.
In this kind of situation involving numerous parameters and a significant level of technicality, the credit officer may be tempted to seek the opinion of one of their colleagues to be sure of making the right decision. The influence of colleagues, known as the peer effect, can thus impact the individual preferences of credit officers, resulting in up to a one percent difference in rates.
Assimilation or contrast?
In general, an individual is more likely to ask for the opinion of a person whoresembles, but this attitude is mainly motivated by the desire to obtain information that will be useful in their personal situation. Thus, asking for an opinion does not necessarily mean adopting the same point of view.
In the case of a loan officer who seeks the opinion of his colleague, this loan officer can therefore have two different reactions. Either he decides to adjust his point of view to align his decision with what his colleague thinks (stance ofassimilation), either he chooses not to go in the same direction as his colleague (stance ofcontrast). The results of our study reveal that both postures exist and depend on the profile of the credit officer.
In the case of a loan officer who tends to favor qualitative information more related to the bank-borrower relationship and who, in addition, works in a branch where this preference is shared, the peer effect amplifies this tendency and the loan officers pay more attention to this information. They reinforce their positions and their credit decisions are adjusted accordingly: this is an example of assimilation where the loan officer aligns with their peers.
Conversely, the peer effect can mitigate individual preferences in the case of loan officers who prefer to use so-called quantitative financial information to make their decision. In other words, a loan officer who places high value on the analysis of accounting documents in an agency where this approach is less shared will adjust their decision to take greater account of qualitative information, which would generally be less important to them. This dynamic reflects a contrasting stance where the loan officer will adjust their decision in the opposite direction to what they would have done without the opinion of their colleagues.
A matter of experience?
The data supporting our study also make it possible to identify the profiles of loan officers most sensitive to peer effects. Firstly, if we look at the characteristics of loan officers: women, being more sensitive to qualitative information, are more influenced than men. Their evaluation of loans is reinforced when their colleagues share their relational view of credit.
If we turn to the experience of loan officers, the less experienced are more susceptible to the opinion of their peers. Conversely, senior officers maintain their initial positions more firmly. Finally, a surprising fact emerged: the level of education does not seem to influence sensitivity to peer effect.
The work environment also plays a role. In small agencies where socialization is high, the peer effect intensifies. In larger agencies, where interactions are more diluted, this effect decreases. Finally, a loan officer favoring qualitative information who joins an agency sharing this preference will see the impact of their preferences amplified. The result is the same for those valuing quantitative information. This demonstrates that the composition of a bank branch shapes borrowing decisions, beyond the bank’s overall policies.
A question for the HR departments of banks
These conclusions raise the question of the best organization for banks? To avoid excessive homogeneity in decisions, which can lead to discriminating against certain borrowers or undervaluing certain information, banks should promote diversity of profiles within the same branch by favoring gender mix and diversity of experience. Transfers between branches should also take into account the current composition of teams, and not just personal affinities or vacant positions. The use of AI tools would not eliminate this possible gap, as AI can be very biased depending on the database that trained it, and to date, a decision cannot be made by AI.
Decisions related to granting credit and determining borrowing conditions are never purely individual. They are constructed through an implicit dialogue with peers, and this cannot be ignored. Understanding the underlying mechanisms of these decision-making processes allows banks to comprehend their own practices and to seek fairer decisions for themselves and their clients.
The authors do not work for, are not consultants to, do not own shares in, and do not receive funds from any organization that could benefit from this article, and have declared no affiliations other than their research institution.
–ref. Influence of colleagues: does obtaining a loan depend solely on exchanges with one’s banker?https://theconversation.com/influence-des-collegues-obtenir-un-credit-depend-il-uniquement-des-echanges-avec-son-banquier-278838