NRI Investing in India: NRE, NRO and PIS Without the Jargon
Which bank account your investments run through, what is repatriable, and the documents to keep ready.
Urja Investment DeskInvestor education
A Non-Resident Indian can invest in Indian shares, mutual funds and IPOs. What differs from a resident is the plumbing: the bank account the money moves through decides whether it can be taken back abroad.
Two bank accounts, two purposes
| NRE account | NRO account | |
|---|---|---|
| Funded from | Foreign earnings remitted to India | Income arising in India — rent, dividends, pension |
| Repatriation | Freely repatriable | Subject to limits and tax clearance |
| Typical use | Investments you may want to take back | Managing Indian income and legacy holdings |
What PIS means
The Portfolio Investment Scheme is the Reserve Bank of India route under which NRIs buy and sell listed shares on the exchange. Trades are reported through a designated bank. Your broker, bank and demat account are linked for this purpose.
What you can and cannot do
- Delivery-based equity: permitted.
- Intraday equity trading and short selling: not permitted for NRIs.
- Mutual funds and IPOs: permitted, subject to the scheme or issue accepting NRI applications.
- Derivatives: permitted on a non-repatriable basis with additional set-up.
Documents to keep ready
- Passport and visa or residence permit.
- PAN card.
- Overseas address proof and Indian address proof, if any.
- NRE/NRO bank account details and a cancelled cheque.
- FATCA/CRS declaration and a recent photograph.
When your status changes
If you move abroad, tell your bank, broker and DP so resident accounts are re-designated. If you return to India, the reverse applies. Continuing to operate a resident account as an NRI is a FEMA issue.
This article is for investor education. It is not investment, tax or legal advice and is not a recommendation to buy or sell any security. Investments in the securities market are subject to market risks; read all related documents carefully before investing.