The State Council, China's cabinet, has approved an increase in Hong Kong's Renminbi Qualified Foreign Institutional Investor (RQFII) quota, according to an official statement Tuesday.

The quota will be expanded to 500 billion yuan (about 73.65 billion U.S. dollars) from the current 270 billion yuan, according to a statement by the People's Bank of China.

The move will further satisfy demand for yuan-denominated assets by Hong Kong investors, further opening the financial market on the Chinese mainland, and strengthening financial ties between the two sides, the statement said.

Introduced in 2011, the RQFII program allows institutional investors with offshore renminbi deposits to invest in China's onshore market, part of efforts to globalize the renminbi.

Hong Kong is the first place for pilot implementation of the RQFII scheme. The quota for Hong Kong had been expanded twice, to 270 billion yuan in 2014, and has already been fully allocated, according to a statement by the Hong Kong Monetary Authority.

"RQFII has been an important channel for overseas investors to invest in the mainland financial markets since its introduction in late 2011," said Norman Chan, chief executive of the authority.

"Hong Kong's RQFII quota has been further increased significantly and remains the largest in the world, and this highlights our important role as an intermediary to facilitate overseas investors' participation in the mainland financial markets," he said.

Tuesday's decision marked the latest efforts by Chinese authorities to open up the financial market to overseas investors.

On Monday, the mainland-Hong Kong bond connect was launched, providing a new channel for qualified overseas investors to invest in the Chinese mainland interbank bond market.