NRI accounts in FundsIndia

FundsIndia supports mutual fund investing by non-resident Indians (NRIs). An NRI can open an account with FundsIndia and invest in mutual funds using their net-banking account. There are some restrictions, and a few extra/specific requirements for an NRI to transact in mutual funds in India, however.

Requirements

An NRI needs the following to be able to open an investment services account with FundsIndia and invest in mutual funds:

1. An Indian passport or an OCI/PIO card
2. A PAN card
3. An overseas address with proof there-of
4. An NRE/NRO account in India

We would need the investor to undergo the same one-time KYC registration as a regular investor using their overseas address proof.

A note about NRE/NRO accounts

NRE bank accounts are accounts that hold repatriable money. That is, money in such accounts can be converted back to a foreign currency. NRO bank accounts, on the other hand, are accounts that hold non-repatriable money. Money in NRO accounts will stay as Indian rupees and cannot be readily converted back.

If an investor has a choice, we would highly recommend using an NRO account for their mutual fund investing. The reason for this is the documentary requirements for operating an NRO linked mutual fund investing is less than that for an NRE account. Since money in NRE accounts are repatriable, mutual fund companies often ask for bank statement proof for every transaction to show that the money indeed did originate from an NRE account (FIRC rules). With an NRO account, there are no such requirements.

A note about mariners

At �FundsIndia, we have several sea-faring mariners holding NRI accounts. One frequent question they have is with regards to their overseas address proof. Since they are in ships, it is difficult for them to produce one. What we have determined is that the Continuous Discharge Certificate (CDC) issued by their employer is an acceptable proof for their overseas address for KYC purposes. They can also use their NRE/NRO bank account statement as proof for this purpose.

How to open an NRI account

Opening an NRI account is very similar to opening a regular investor account from a FundsIndia operational perspective. The investor would need to go through the same process (provide details online, get the application form generated, send it in with required documentary proofs).

What we would advice our prospective NRI clients to do is to send us scanned images of their documents first for verification. We can go through the documents and let you know if they are good for account opening or needs corrections. This can save time and money in terms of sending documents via overseas courier.

Restrictions

There are some mutual fund schemes that are not allowed to accept investments from NRIs. This is specifically true for US-based NRIs for whom certain fund houses do not allow their schemes to be sold to. FundsIndia's system will recognize such situations and disallow the investor from choosing such schemes for investments.

Examples of AMCs that do not let their schemes to be sold to US based NRIs are Franklin Templeton, Fidelity, Quantum, ICICI Prudential mutual fund, and AIG mutual fund.