India has always been a favourite investment hub for NRIs simply because there are plenty of attractive options here. In the past few decades, NRI investments have increased. This is because globally, India is seen as an emerging economic power and has assumed the role of an important player on the world platform. Since it is an economically sound nation, investing in Indian businesses is seen as a profitable option for NRIs today who see returns higher than ever.
Here are some reasons why India is an attractive investment hub for you as an NRI:
India's booming economy
NRIs are drawn by India's economy which is growing at a fast rate. The country's annual GDP expanded 7.55% in 2015-16 and the World Bank has predicted a growth at 7.7% in 2017. Consumer spending has grown over the years. Volatile markets and competitive prices have forced consumers to stop hoarding money in banks and go out there and spend it instead. This urge to splurge has translated into good corporate performance. India's consumption economy is making it a great place for foreign investment too.
The Indian rupee has been falling for some time now and is frequently subject to volatility on the back of global instability. Whenever it depreciates, you benefit as an NRI because you get more rupees against your foreign currency. This also means you invest less and get back more.
Equity market returns
Investor participation in the stock markets is on the rise, thanks to increasing financial literacy and reach of mutual funds. Equities are a great way to benefit from the future growth of Indian companies. Market analysts expect Indian stock market to rise by manifold levels by 2020, on the back of good corporate earnings as consumption demand grows.
RBI's generosity in permitting remittances
RBI has been favourable towards NRIs, allowing returns on investments to be repatriated easily. You are allowed to remit up to USD 1 million each financial year from an NRO account while NRE assets can be fully repatriated.
Easy taxation for NRIs
India's tax laws favour NRIs too because India has Double Tax Avoidance Agreements (DTAA) with many countries, including the UAE and USA.
Future of India
The Indian Republic is considered as one of the possible emerging superpowers across the world. The demographic trends and rapidly expanding economy are the major indicators of the developing nation. India's domestic consumption, which is primarily led by the private sector, has played a significant role in the growth of the country and is expected to remain firm in the future.
- Who Is An NRI Investor? :
An Indian citizen or a foreign citizen of Indian origin who has stayed abroad for employment/carrying out business or vocation for 182 days or more or under circumstances indicating an intention for an unknown duration of stay abroad is a Non-Resident Indian (NRI). Those who stay abroad on business visits, for medical treatment, study or such other purposes, which do not indicate an intention to stay there for an indefinite period, are not considered as NRIs.
- What are the services offered to NRI? :
Join Us for a Reason
No matter whether you stay in India or abroad, the Indian economy always welcomes you to put your hard-earned money and create wealth out of it. You must grab the best investment opportunities with Ez SIP, which is dedicated to serving you as per your expectation.
- Account Setup :
We help our NRI client in setting up their online account, getting through the KYC process and other legal formalities. We assist our clients through all the legal and regulatory requirements that are mandatory to be fulfilled before any investments can be made.
- Goal Setting & Portfolio Design :
The experts at Ez SIP will talk to you and understand your financial goals, your risk appetite and your investment horizon. After careful consideration and taking into account your goals our team of experts will help design a customized portfolio of mutual funds and other investment products.
- Portfolio Execution:
Once the customized portfolio is designed our NRI clients can buy the recommended schemes online or they could get in touch with us where we help them in buying individual schemes in the portfolio
- Monitoring and Tax advice:
On your request our expert team will monitor your portfolio and would advise from time to time if there is any need of rebalancing. We also help our NRI clients with repatriation of funds and any tax advisory that is required at the clients end.
- What is the process of NRI Investment? :
Smart Investments in India for NRI Investors!
A smart way of investing in the Indian Mutual Fund industry is right here. You can initiate your investments in India by registering with Ez SIP, which allows you to take the benefit of the best investment solutions for making your financial future secure with mutual funds.
Steps to Get Started
- Create Your Account :
It is simply an easy process to get started with your investment in India. The NRI investors are allowed to invest in India on repatriable as well as the non-repatriable basis. You need to create your Ez SIP account by providing your necessary details as required, along with the scanned copies of the documents requested according to your tax and residential status.
What are NRE and NRO Accounts
Non-Resident (External) Rupee (NRE) account is a rupee account from which funds are freely repatriable. It can be opened with either funds remitted from abroad or local funds maintained in NRE/ FCNR accounts, which can be remitted abroad. The deposits can be used for all legitimate purposes. The balance in the account is freely repatriable. Interest credited to the NRE accounts is exempt from tax in the hands of the NRI.
Non-Resident Ordinary Rupee (NRO) account is a rupee account and can be opened with funds either remitted from abroad or generated in India. The amounts in such an account are generally non-repatriable. However, funds in NRO accounts can be remitted abroad subject to/as per various directives in force at the time of repatriation.
- KYC Compliance :
Every mutual fund investor whether resident or non-resident is required to be KYC compliant as per the Prevention of Money Laundering Act. NRI's are supposed to use their overseas address while doing their KYC.
What KYC Formalities Are Required To Be Fulfilled By NRI Investors?
Being a KYC Compliant has Become Easier!
SEBI Guidelines and the Prevention of Money Laundering Act (2002), have made it mandatory for every mutual fund investor to become a KYC compliant prior to investing. It entails, verification of identity and address, financial status, occupation, and other personal information.
Steps to Become a KYC Compliant
There are certain steps required to be followed in order to fulfill the KYC formalities of an NRI investor.
- File the duly filled KYC form
- Recent Photograph
- A self-attested copy of PAN card or your Passport as identity proof.
- A self-attested copy of the overseas address (Passport or Bank Statement of NRE/NRO account or PIO card).
- A copy of the Indian address proof.
- A bank statement of overseas bank account.
- vii. A funds remittance certificate from the bank overseas.
- Submission of relevant documents:
- An Indian Passport or OCI/PIO Card
- A PAN Card
- An Overseas Address Proof
- An NRE or NRO Account Bank Statement
- Funds Remittance Certificate
- Invest! Online :
Once the KYC requirements are completed and all the paperwork is in place, you are set to proceed with your investments. You can select any of the schemes from our ready-made basket or you may choose to pick the funds of your choice. We have an extensive range of products which would cater to all your financial needs. Investments can be made either in a lump-sump manner or through a systematic investment plan (SIP)
- How Can NRI's Redeem their Investments?:
If an NRI opts for investing online then he/she is eligible to apply online for redemption too. Otherwise, the clients are required to submit the redemption request in original at the nearest official point of acceptance of transactions. After the request has been accepted the amount will be credited as follows: For non-repatriable investments, the amount generated by way of redemption will be honored through a cheque payable at an NRO account. NRI clients are also free to get their redemption amount transferred promptly to their NRE/NRO bank account in India, which is quite hassle-free.
- What Are The Tax Implications For NRI Clients?:
The dividends of each and every scheme are tax free for the NRI clients. While long-term capital gains (equity) are tax-free, whereas for short term capital gains (equity) 15% tax has to be paid. On the other gains, the NRI clients have to pay tax which is 20% with indexation and 10% without indexation.
The applicable tax rates for NRI's are as follows:
| Investment Type
|| Tax Rate for NRIs
| Long-Term Capital Gain on Equity-Oriented (Units held for more than 12 months)
| Short-Term Capital Gain on Equity-Oriented (Units held for less than or equal to 12 months)
|| 15% + 15% Surcharge + 3% Cess =17.7675%
| Long-Term Capital Gains on Other Than Equity-Oriented Schemes (Listed Units held for more than 36 months)
|| 20% with indexation + 15% Surcharge + 3% Cess =23.690%
| Long-Term Capital Gains on Other Than Equity-Oriented Schemes (Unlisted Units, held for more than 36 months)
|| 10% without indexation + 15% Surcharge + 3% Cess = 11.845%
| Short-Term Capital Gains on Other Than(Listed or Unlisted Units held for less than 36 months)
|| 30%^ + 15% Surcharge + 3% Cess = 35.5350%
- Can a NRI investor buy Mutual Funds Online?:
An NRI client can access our online platform from any part of the world for investments except for few countries that have been banned as they are FATF non-compliant / non-cooperative or are under US sanctions. An Indian citizen residing in countries like Burma, Iraq, Indonesia, Ecuador, North Korea, etc. are not allowed to invest in India.
- Is It Possible To Convert The Status Of An NRI Mutual Fund Account To A Resident Indian?:
Yes, an NRI client is eligible to convert the status of his account to resident as per the Section 6(5) of FEMA after fulfilling few formalities. The client is responsible for intimating about the change in status to the assigned and authorized dealer through which he/she had initiated the investment and has opened the demat account. A new demat account with resident status needs to be opened and all the mutual fund holdings have to be transferred to the new demat account.