<h1>RBI Discussion Paper Proposes Four-Tier Banking System to Boost Competition, Growth, and Financial Inclusion in India.</h1> The Reserve Bank of India released a Discussion Paper on restructuring India's banking system to enhance competition, support growth, and promote financial inclusion. Key issues include the balance between small and large banks, the adoption of a universal banking model, and the potential conversion of Urban Cooperative Banks into commercial banks. The paper suggests a four-tier banking structure, emphasizing the need for regulatory oversight and consolidation. It also discusses foreign bank participation, Indian banks' global presence, and government ownership strategies. The paper invites comments and aims to adapt the banking system to a dynamic economy while learning from the global financial crisis.