The move marks another step in China's efforts to nurture the over-the-counter (OTC) market amid moves to diversify the capital market, analysts said.

　　The New Third Board was initiated in 2006 as an experimental platform intended to facilitate financing for China's non-listed small, promising high-tech enterprises in Beijing's Zhongguancun Science Park, allowing them to transfer shares and raise funds for specific purposes.

　　The trial later expanded to cover several high-tech zones in Shanghai, Wuhan and Tianjin before being officially established on Wednesday.

　　Yao Gang, vice chairman of the China Securities Regulatory Commission (CSRC), called the latest move "a significant transition" in the country's construction of the OTC market.

　　As of the end of 2012, around 200 companies traded on the New Third Board, and analysts expect the scale to accelerate in 2013 with the new developments. But they also pointed out that more innovative policies are needed to stimulate activity on the board, which has been sluggish.

　　In 2012, transactions on the board decreased 22.8 percent from 2011, and the average funding per firm came in at only 33.8 million yuan (about 5.4 million U.S. dollars), far from enough to feed China's hungry SMEs.

　　The key to making the new mechanism effective is policy reforms in regulations covering market entrance, public transfers, financing and market makers, according to a research report by Shenyin&Wanguo Securities.

　　Yao said the CSRC will explore a proper development path for the new board to strike a balance between the exchange and OTC markets.