China's Securities Regulatory Commission (CSRC) may expand its RMB Qualified Foreign Institutional Investors (RQFII) pilot program in a bid to further open the country's capital market.

The CSRC and other relevant bodies are studying an expansion plan and aim to "make breakthroughs" in easing restrictions on the types of institutions, investment scope and ratio, the Shanghai Securities News reported on Saturday, citing an unnamed official close to the commission.

The CSRC is also considering allowing some institutions under the RQFII program to issue exchange-traded funds (ETFs) made up of A-shares, according to the official.

The RQFII mechanism, which was launched in December 2011 to widen investment channels for overseas yuan funds on the Chinese mainland, allows qualified investors to invest yuan-based funds raised in Hong Kong in the mainland securities market within a permitted quota. The total investment quota is approximately 20 billion yuan (3.2 billion U.S. dollars).

China's foreign exchange regulator set a 10.7-billion-yuan investment quota for the first ten RMB Qualified Foreign Institutional Investors (RQFII) in December 2011, and the second quota of 9.3 billion yuan was approved this month.

Despite its many restrictions, the program has facilitated the back flow of the yuan and promoted the internationalization of the currency, the official said.