Is there a restriction on the number of cards that may be issued on a sole proprietor's account? If possible, please provide a regulatory basis for such restriction.

I don't think that Visa allows their consumer debit cards to be issued to any type of business. You have to be on Visa's business card program. I don't do this every day, so you would need to look at Visa's guidelines (and good luck with THAT!)

Brenda is right. Visa restricts the Debit cards to consumers. Sole proprietorships are not considered a consumer (usually).

I believe VISA has recently introduced a Business Debit card program, but I don't have any details.