You have set up a basic authentication policy, but the API proxy returns an HTTP...

A possible reason why the API proxy returns an HTTP status of 401 after setting up a basic authentication policy is that in the AssignMessage policy, the AssignTo tag has the type=“response”. This means that the basic authentication value is assigned to the response header instead of the request header. This will cause an authentication failure when calling the backend server or service that requires basic authentication. To fix this issue, you should change the type attribute of the AssignTo tag to type=“request”. This will ensure that the basic authentication value is assigned to the request header before sending it to the target endpoint. References: Basic Authentication | SAP Help Portal, Assign Message Policy | SAP Help Portal