BEIJING -- China's banking watchdog issued a notice encouraging more private funds toward rural credit cooperatives (RCC) on Monday amid reforms.

Requirements will be lowered so as to channel more private funds into RCC and turn them into commercial banks, said a notice from the China Banking Regulatory Commission.

By the end of 2013, 590 RCC had been turned into commercial banks or rural cooperative banks with the help of private funds, which took 85 percent of their shares during the reforms, the statement said.

In the 1950s, a network of RCC was created, but they were not commercial enterprises similar to banks. They began to function as grassroots banks to provide credit and saving accounts to families and collective enterprises after China's reforms and opening-up in the late 1970s.