(Adds quotes from media briefing, statement; banks' comments)

By Scott Murdoch and Samuel Shen

SHANGHAI, Sept 10 (Reuters) - China kicked off on Friday a long-awaited scheme, called Wealth Management Connect, that links its southern province of Guangdong with Hong Kong and Macau, as Beijing moves to pull the two territories closer.

The cross-boundary scheme will initially bring combined fund flows of 300 billion yuan ($46.53 billion) in the three areas together known as the Greater Bay Area (GBA), the Hong Kong Monetary Authority (HKMA) said.

"The scheme will not only offer more investment options for individual GBA investors but also create new opportunities for the banking and wealth management industry in the three places," HKMA chief executive, Eddie Yue, said in a statement.

It will also promote cross-border use of the Chinese currency, strengthening Hong Kong's role as the global hub for offshore yuan, Yue added.

Twenty Hong Kong banks have expressed interest in participating, said HKMA's deputy chief executive Edmond Lau.

"If the scheme proves popular we could increase the quotas so regulators will have a pragmatic approach," he told a media briefing.

Global banks and asset managers hailed the launch.

"The WMC scheme is a key milestone in China's financial market liberalisation," said Elisa Ng, Hong Kong head of J.P. Morgan Asset Management, which has been preparing for the pilot program since it was announced in June last year.

Sebastian Paredes, chief executive of DBS Hong Kong, expects the region to provide a quarter of the customers in the bank's Hong Kong Treasures Wealth programme over the next three years.

"We see immense opportunities in expanding our business into China," he added.

Bank of China (Hong Kong) and the Private Wealth Management Association (PWMA) also welcomed the effort.

"We look forward to engaging with relevant authorities on how to expand the scheme’s scope in the future," Amy Lo, who chairs the executive panel of the Association, said in a statement.

EXTRA INCENTIVES

China's latest move to further open its financial markets comes ahead of the imminent launch of the southbound-leg of the Bond Connect for mainland investors to buy offshore debt.

The programme enables residents of Hong Kong and Macau to buy mainland investment products sold by banks in the Greater Bay Area, while allowing residents of nine Guangdong cities to buy those sold by banks in the two offshore centres.

Eligible wealth management products for mainland investors in the scheme include deposits as well as equity and bond funds in Hong Kong, the HKMA said.

Mainland China and Macau announced scheme implementation details separately.

Initially, net cash flows in either direction must not exceed 150 billion yuan and the individual investment quota is 1 million yuan.

Similar previous initiatives include Stock Connect and Bond Connect, but Wealth Connect is the first cross-boundary scheme focused on the Greater Bay Area, whose combined gross domestic product is similar to that of Australia or South Korea.

"We believe banks with strong onshore and offshore branches in the GBA will enjoy an advantage when leveraging this opportunity," Jasper Yip, a partner at consultancy Oliver Wyman, said this week.

The news comes days after Beijing gave fresh impetus to developing the region, with new plans for two Guangdong cities, Qianhai and Hengqin.

In 2017, President Xi Jinping unveiled plans to turn the region into an economic powerhouse, and integration appears to be accelerating after China imposed a new security law in Hong Kong last year. ($1=6.4471 Chinese yuan) (Reporting by Samuel Shen and Andrew Galbraith; Editing by Vidya Ranganathan and Clarence Fernandez)