Investors talk to a member of staff at a securities outlet in Zhengzhou, capital of Central China's Henan Province on Monday. Photo: CFP

Investors in Chinese mainland stock markets can now open multiple accounts, starting from Monday, the State-owned clearing firm announced late on Sunday, in a move that is expected to boost the flow of funds into the markets.

The China Securities Depository and Clearing Co (CSDC) said in a statement late on Sunday that it was scrapping the "one person, one account" policy, and that investors would be allowed to open up to 20 accounts.

The move is in line with China's move toward internationalization and marketization of its capital markets, Zhao Xijun, deputy dean of the School of Finance at the Renmin University of China, told the Global Times.

"This will improve the market's efficiency," Zhao noted.

The decision follows a series of other recent capital market reform policies.  

China launched a unified account platform for securities from October 1, 2014, allowing investors to use one account in the Shanghai and Shenzhen stock exchanges.

Also starting from October 1, 2014, the CSDC lifted the "one person, one account" limit for institutional investors and for individual investors using the Shanghai-Hong Kong Stock Connect scheme.

"The government wants to encourage ordinary investors, just as Premier Li Keqiang once urged people to start their own businesses," Li Shuguang, a professor at the China University of Political Science and Law, told the Global Times on Monday.

"Besides, China's stock markets are quite complicated, with three main boards and several other secondary boards, and it was not very convenient for investors to have to use just one account. It's time to lift things that restrict investors' market activities," Li said.

Investors will now have more choices, which will enable them to get more competitive fees and better services, but it will increase competition among brokerages, both Li and Zhao noted.  

Shares in brokerages on the A-share markets declined by 1.07 percent on average on Monday, but the markets reacted positively to the CSDC decision, despite weak March exports data.

The Shanghai Composite Index jumped by 2.17 percent to 4,121.72 points, and the Shenzhen Component Index rose by 0.97 percent to 14,149.50 points.

The likelihood of fiercer competition means that brokerages will have to improve their services in order to attract customers, and "this will improve the overall efficiency and quality of the financial industry," Zhao said.

It also means there will be more accounts and more liquidity in the markets, which have already seen a surging inflow of funds recently, Li noted, with total turnover on the Shanghai and Shenzhen bourses exceeding 1 trillion yuan ($160.8 billion) for the 10th straight trading session on Monday.

Backed by monetary easing policies and market reforms, mainland stock markets have been on a bull run since November 21, 2014 when the People's Bank of China, the central bank, lowered benchmark interest rates for the first time since 2012.

In the past six months, more than 13 million new accounts have been opened in the A-share market. During the week that ended on April 3 alone, 1.56 million new accounts were opened, bringing the total number of accounts to 151 million, according to data from the CSDC.

"I will open more accounts with different companies in order to boost my chances of benefiting from the coming IPOs," Ling Pei, a Beijing-based investor with 20 years of experience in the A-share market, told the Global Times on Monday.

"But I'm concerned that allowing multiple accounts might cause a bubble, especially if investors can borrow money from different brokerages for margin trading," Li noted.

Margin trading, an investment strategy in which investors borrow money to buy stocks, has been increasing rapidly during the recent market bull run.

According to data from the Shanghai Stock Exchange, the outstanding balance of margin debt on the exchange was 1.1 trillion yuan on Friday, more than double the figure in mid-November.

The CSDC said in its Sunday statement that it would strictly monitor the process to prevent any illegal activities or misuse, and it urged brokerages to open new accounts only for investors who have genuine demand for multiple accounts.