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1. 1. Can NRIs open demat account in India?

   Yes, NRIs can open a demat account in India. In fact, a demat account is must to invest in stocks, mutual funds, and derivatives, etc., in Indian stock exchanges.

   The demat account is an online account to hold securities like stocks, MF, and debentures etc.

   An NRI demat account can be opened on Repatriable or Non-Repatriable basis. These accounts are linked to NRE or NRO Bank account.

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2. 2. Can NRI open a joint NRI Demat account?

   Yes, NRIs can open a joint NRI Demat Account. The joint holders in an NRI demat account can be either another NRI or a Resident Indian.

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3. 3. Do I need to get RBI approval before opening my Demat Account?

   No, you do not need any approval from RBI to open a demat account.

   But to trade or invest in India Stock Market on a repatriation basis, you need PIS permission from RBI. Portfolio Investment Scheme (PIS) enables NRIs to buy and sell stocks in India by routing these transactions through their NRE Bank. The bank that has your NRI Bank Account helps you to get this permission.

   If you are planning to invest on a non-repatriation basis, you do not need RBI PIS Permission. You just need an NRO Bank Account linked to your trading and demat account.

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4. 4. Does NRI need to open NRI Demat account if he has resident Demat account?

   Yes, you need to close the existing Demat Account opened when you were a 'Resident Indian', and a new NRI demat account needs to be opened. The securities held in your old demat account can be moved to the new NRI demat account.

   You would need to present documents supporting the acquisition of the securities like contract note or a letter of allotment.

   In case if you do not plan to make any fresh investments as an NRI, then you can continue holding the existing resident Demat account to hold the securities purchased in the capacity of a resident Indian on a non-repatriable basis with no plans to sell in near future.

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5. 5. Can someone else, residing in India, operate my Demat Account?

   Yes. For this, you have to give a Power of Attorney in favor of the person residing in India. Also, a copy of the Power of Attorney, duly notarized, must be submitted to your stock broker.

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6. 6. Can NRIs have Demat Account in India?

   Yes, NRI's are eligible to open and operate the demat account in India.

   While a demat account can be opened by NRI without any approval from RBI, the NRI customer needs RBI PIS approval to buy/sell shares in India on a repatriation basis.

   Note that the demat account is an online repository of shares. It's an online account similar to a bank account. It holds shares, Mutual Funds, ETFs and, Bonds etc. in electronic format.

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7. 7. Can NRI hold a demat account in India?

   Yes, NRI's are permitted to have a demat account in India to hold securities in electronic format. These securities include shares of listed companies, mutual funds, ETFs, Bonds etc.

   While opening a demat account, NRI has to choose account type as 'NRI Account' and subtypes as below based on the investment need:

   1. NRE Demat Account (Repatriable Demat Account)
   2. NRO Demat Account (Non-Repatriable Demat Account)

   An NRI has to link his demat account with an NRE or NRO bank account (PIS or Non-PIS) based on the requirement. The dividends and proceed from the sale are deposited into this linked account.

    

   Note that if you have recently become an NRI and hold a Demat Account (Resident Indian), you will have to close the existing demat account and open a new NRI demat account. You could choose to sell all the holding in your existing account or transfer them to the new account. When transferring, you may have to provide the proof of purchase i.e. contract note.

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8. 8. Can NRI maintain demat account in India?

   Yes, NRI can maintain an NRI demat account.

   If you are an NRI and still hold a demat account which you opened when you were in India, it's important to close that demat account and open a new demat account for NRI. However, in case you do not plan to make any new investments you can continue holding the existing securities bought as a resident Indian in resident Demat account on a non-repatriation basis.

   In a similar way, if you were an NRI and now moved back to India, it is required by law to close the NRI demat account and open another demat account.

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9. 9. How to open NRI Demat Account online?

   A demat account is a mandatory account for NRIs to invest or trade in the Indian stock market, Mutual Funds, ETFs, Bonds, NCDs, etc. Demat account is like a bank account but instead of money, it holds securities in electronic format.

   NRIs need following accounts or permission to invest in Indian Stock Market:

   1. PAN Number
   2. NRI Bank Account (NRE or NRO)
   3. NRI Trading Account
   4. NRI Demat Account
   5. PIS permission by RBI (if investing on a repatriation basis)
   6. CP Code (if trading in F&O)

   There are 2 ways to open these accounts:

   1. Open 4-in-1 Account with a Bank
   2. Open Bank account with a Bank and Trading & Demat Accounts with a broker

   The 1st option of account opening is easy, convenient, and completely online. Visit the website of any one of the popular banks (prefer the bank you already have a relationship with) and fill their NRI Account inquiry form. You will get a call from them in 24 hours to assist you with account opening.

   In the case of the 2nd options, first, follow the above steps to open the 2 bank accounts. Once you have them ready, choose a broker i.e. Zerodha, Angel Broking or Sharekhan to open the trading and demat account.

   Note the 4-in-1 account offer convenience but their charges are very high in comparison to the brokers like Zerodha or ProStocks. Also, the trading tools available with discount brokers like Zerodha are way more superior then the banks.

   Documents required to open an NRI Demat Account

   • Filled demat account opening form signed by all the holders.
   • PIS Permission Letter from the bank (if investing on a repatriation basis)
   • Photographs of all the holders with signatures across the photo.
   • PAN Card copy for all holders.
   • Overseas address proof for all the holders.
   • Canceled cheque of the linked NRE/NRO Bank account specified in the form
   • Photograph and signature of the nominee (for nomination facility).

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10. 10. Can stocks be held in one demat ac irrespective basis of repatriation?

    No. An NRI must open separate demat accounts for holding repatriable and non-repatriable securities.

    An NRI customer has to choose one of the following subtypes of NRI Demat account while opening the account:

    1. NRI Repatriable
    2. NRI Non-Repatriable

    Also, the NRI Demat account must be linked with a corresponding bank account.

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11. 11. Can an NRI nominate or be nominated in the demat account? Can a person resident in India be a nominee in NRI Demat account?

    Yes. Nomination in a demat account is possible in both the ways.

    • An NRI can be nominated in a resident Indian demat account.
    • An NRI can be nominated to an NRI Demat Account.
    • A resident Indian can be a nominee in an NRI Demat Account

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12. 12. What bank account details are to be given during NRI Demat ac opening?

    The following bank accounts may be given

    • For non-repatriable - NRO [dividend/interest is repatriable]
    • For repatriable - NRE

    The above details should be provided to the broker (DP) with whom you have the demat account. The DP uses this information to directly credit dividend or interest.

    (Dividend/interest received on Investments made on repatriation and non-repatriation basis under the Portfolio Investment Scheme is an eligible credit to NRE (PIS) Account and NRO Account respectively).

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13. 13. Where to open NRI Demat Account?

    An NRI can open a Demat Account with any stock broker in India who offers NRI services. Most stock broker and banks offer NRI Demat Account. This includes:

    • Bank (NRI 3-in-1 Account) - ICICI, HDFC, Kotak, SBI, Axis Bank
    • Full-Service Broker - Sharekhan, IIFL, Motilal Oswal, Geojit, Edelweiss
    • Discount Stock Broker - Zerodha, ProStocks. Tradeplus

    Visit NRI Demat Account Detail for more detail.

    Demat Account is an online account to hold securities (i.e. Stock, Mutual Fund, NCD, Bonds) in electronic format. Demat Account is opened with one of the two depositories (CDSL and NSDL) through a depository participant (usually stock brokers).

    Note that for trading / investing in the stock market an NRI needs 4 accounts:

    1. PIS NRE Bank Account - For investing in Stocks on repatriation basis
    2. Non-PIS NRO Bank Account - For investing in IPO, Mutual Funds, ESOPs on non-repatriation basis
    3. NRI Trading Account - To trade in the stock market.
    4. NRI Demat Account - To hold securities in electronic format

    NRI 3-in-1 Account, which includes bank, trading and demat account is the most convenient way to invest in India. Most large banks in India offer this account. They offer seamless online trading experience but at a higher brokerage charge.

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14. 14. Do I need RBI permission for NRI Demat Account?

    No, NRIs don't need permission from RBI to open the demat account in India. The NRI demat account is similar to the resident demat account. but at the time of account opening, the NRI customer has to choose the account subtype as NRE or NRO. NRI Demat account should also be linked with the respective NRI Bank Account (NRE or NRO).

    NRI Demat Account and Resident Demat Account are opened and managed in the same way. They carry the same transaction charges, AMC and taxes.

    On Repatriation Basis

    NRI need RBI permission (PIS) to invest on repatriation basis in the stock market. NRI can trade on repatriation basisin Equity F&O through a Custodial Participant (CP) using a CP code.

    On Non-repatriation Basis

    NRI doesn't need RBI/PIS permission to invest on the non-repatriation basis in the stock market or trading in equity derivatives (F&O) in India.

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15. 15. Does NRI need to move holdings from resident Demat to NRI Demat account?

    No, an NRI who already has a resident Demat account and is holding securities in it that were acquired in the capacity of a resident Indian is not required to move those securities into an NRI Demat Account or PIS account.

    NRI can continue to hold the securities on a non-repatriable basis even after he becomes a non-resident Indian. It means that you can hold the securities but cannot transfer its sale proceeds either in foreign currency to your overseas account or your Non-Resident External (NRE) Account. The sale proceeds would be required to be credited to NRO Bank Account. As per laws, repatriation of funds up to USD 1 million per year is allowed, along with other assets for NRIs/ PIOs.

    According to section 6(5) of FEMA Laws:

    A person resident outside India may hold, own, transfer or invest in Indian currency, security or any immovable property situated in India if such currency, security or property was acquired, held or owned by such person when he was resident in India or inherited from a person who was resident in India.

    However, if you would like to make any fresh investments in Indian Stock Market, you would need NRE PIS Bank Account, NRE PIS Trading Account and NRE Demat account to trade on a repatriation basis and NRO Non-PIS Bank Account, NRO Trading Account and NRO Demat Account to trade on non-repatriation basis.

    Many NRI's ask, I am an NRI (Indian origin) residing in the USA. I already have Demat & Trading account, still, I need to open the PIS account (Portfolio Investment Scheme).

    The answer to this is the same as above. If you are planning to make a fresh investment on a repatriable basis, you need an NRI Demat [NRE/NRO], NRI Trading [NRE/NRO], and PIS NRE or Non-PIS NRO Bank Account. However, if you just want to keep or manage your existing holdings as resident Indian, you can continue with the resident account you already have.

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16. 16. Can NRI open demat account online?

    Most stockbrokers do not offer online account opening for NRI trading and demat accounts.

    Some brokers like ICICI Direct offer online NRI account opening for customers residing in the USA and Canada. For all other countries, a customer has to fill the paper form.

    Some broker offers online forms for NRI customers. In this case, customers have to fill a series of online forms, and once completed they are given a link to download the PDF. The customer has to print, sign, attach the supporting documents, and send these forms to the broker's Indian office.

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17. 17. Can rights/bonus shares be issued to NRI?

    Yes, the Indian companies are allowed to freely issue the rights/bonus shares to existing NRI shareholders. The issuing company needs to ensure that the issuance of such rights/bonus shares is within the sectoral cap limit allowed for NRI.

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