China's top securities regulator said it will allow qualified private equity and venture capital firms to enter the public funds business, in a bid to encourage the development of a comprehensive wealth management sector.

Barriers to enter the public funds sector will also be lowered for securities companies and insurance asset managers, the China Securities Regulatory Commission said on Monday.

The move means that not only fund companies but all types of financial institutions providing asset management services can now apply for the public funds business if they meet the requirements.