What is the difference between NRI Demat and Trading Account?

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An NRI has to open 3 accounts to trade or invest in the Indian stock market. This includes:

• NRI Bank Account (NRE or NRO)
• NRI Demat Account (NRE or NRO)
• NRI Trading Account (NRE or NRO)

The NRI Demat Account is used to hold securities in electronic format. The demat account is similar to a bank account but instead of holding money, it holds securities (i.e. Shares, Mutual Funds, ETFs, NCDs etc.).

The NRI Trading Account is an account opened with the stock broker. It facilitates the transactions at the stock market. The stock market investors in India can buy or sell shares only through the stock brokers.

Here are a few key differences between NRI Demat Account and Trading Accounts:

Note:

• Demat and trading account charges (i.e. AMC, brokerage, demat debit transaction charges) varies by broker to broker.
• A broker requires Demat Account Power of Attorney (PoA) to withdraw the shares from demat account when customer sells them online.