Mumbai, Jan. 23 -- The Reserve Bank of India (RBI) on Friday proposed a four-layered structure for non-banking finance companies (NBFCs) and new norms to strengthen their governance and operations.

The RBI, in a discussion paper, proposed to differentiate between NBFCs depending upon the layer they belong to, such as base and middle.

"To sum up, regulatory and supervisory framework of NBFCs shall be based on a four-layered structure - 'Base Layer, Middle Layer, Upper Layer and a possible Top Layer'," it read.

As per the discussion paper, NBFCs in the lower layer will be known as 'NBFC-Base Layer' (NBFC-BL), and for the middle layer as 'NBFC-Middle Layer' (NBFC-ML).

"An NBFC in the Upper Layer will be known as 'NBFC-Upper Layer' (NBFC-...