The timetable for a fully liberalized interest rate has been set, which will force the early introduction of NCDs, Lian said, adding that a possible roadmap for development of NCDs in China will be "large-denomination and long-term deposits first, with small and short-term deposits later."

The new monetary tool will also offer options other than stocks, funds or wealth management products for Chinese investors.

Chinese have long been looking for investments that offer much higher yields than the benchmark one-year deposit interest rate of 3 percent, as the government introduced restrictions over property purchases and the performance of China's stock markets remained one of the world's weakest for the past two years.

Such a thirst for investment has helped fuel the boom in money funds sold via the Internet and funneled a lot of funds into wealth management products, which are considered part of China's risky "shadow banking" system.

Wang Tao, chief economist of UBS, projected that after NCDs, the central bank will then call off the 10 percent upper limit of long-term deposit interest rates, allowing banks to float freely.

The interest rates of short-term deposits may come as the last to be fully liberalized, Wang said.

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