Four foreign banks will provide retail yuan services to people across China from Monday.

HSBC, Citigroup, Standard Chartered Bank and the Bank of East Asia passed the regulator's audit last Thursday and now have unlimited access to the country's 2-trillion U.S. dollars domestic household savings.

The banks, however, have said they mainly intend to promote wealth management services and target China's wealthier customers.

Domestic lenders, trying to fend off competition in the retail market, are also stepping up their efforts to court higher-end customers with services such as private banking.

The regulator said Chinese institutions should provide personalized products and services, and added that the banking sector in Shanghai is benefiting from a great climate of innovation and development, attributed partly to anticipated competition from the foreign banks.

The four overseas institutions have more than 100 outlets across China. They said over the weekend that their Shanghai branches would offer full yuan services from today while others are expected to do so shortly.

"It's an important milestone in our bank's development and a significant beginning for us to provide full banking service to large numbers of domestic residents," said Yu Xueqiang, head of Bank of East Asia's China business.

In addition to wealth management, the four banks can now provide a wide range of services, including mortgage loans.

They could also expand their funding sources for corporate banking business by gaining access to personal savings and inter-bank borrowing.

The four banks, however, have fewer branches than their established domestic rivals. As such, they plan to highlight their wealth management services and target high-end customers by requiring high minimums.

Standard Chartered said it would roll out various renminbi products for customers under two retail brands - Priority Banking and Excel Banking.

HSBC will concentrate on its Premier Wealth Management service for its retail banking business and charge 300 yuan a month to handle accounts with less than 500,000 yuan.

Last week, Citigroup became the first foreign bank in China to offer a yuan-denominated investment linked insurance product.

The bank, the largest in the US, is providing the service with the United MetLife Insurance Company.

Domestic banks are foraying into the super high-end sector.

Bank of China, the nation's second largest lender, launched a private banking service for millionaires in Beijing and Shanghai last month.

China Banking Regulatory Commission's Shanghai bureau said some domestic institutions need to move faster to enhance their services.