Document

NRI Account Opening

Modified on: Mon, 1 Aug, 2022 at 3:06 PM

TABLE OF CONTENTS


  • Who can open a NRI account?
  • What are the different types of NRI accounts?
  • What are the charges?
  • What basic information should I know about NRI Trade Account?
  • What is a PIS Account?
  • How to open a NRI Trading account?
  • What are the documents required to open an account?
  • Is PIS Bank account required to open a NRO Trading?
  • How long does it take to open a NRI account?


    Who can open a NRI account?


    The following persons are eligible to open a NRI account

     

    a) NRI or Non Resident Indian 

     

    NRI is a person who has stayed out of India for more than 182 days in a financial year.

     

    b) OCI or Overseas Citizen of India.

     

    A foreign national, who was eligible to become citizen of India on 26.01.1950 or was a citizen of India on or at anytime after 26.01.1950 or belonged to a territory that became part of India after 15.08.1947 is eligible for registration as Overseas Citizen of India (OCI). Minor children of such person are also eligible for OCI. However, if the applicant had ever been a citizen of Pakistan or Bangladesh, he/she will not be eligible for OCI.

     

    c) PIO or Person of India Origin


    A Person of Indian Origin (PIO) means a foreign citizen (except a national of Pakistan, Afghanistan Bangladesh, China, Iran, Bhutan, Sri Lanka and Nepal) who at any time held an Indian passport

     

    Or

     

    who or either of their parents/ grand parents/ great grand parents was born and permanently resident in India as defined in Government of India Act, 1935 and other territories that became part of India thereafter provided neither was at any time a citizen of any of the aforesaid countries ( as referred above);

     

    Or

     

    Who is a spouse of a citizen of India or a PIO


    What are the different types of NRI accounts?


    There are basically 2 types of NRI account.


    a) NRE Equity Cash  – Non Resident External – Repatriable account

    b) NRO Equity Cash– Non Resident Ordinary – Non Repatriable account


    NRE account – Any NRI may open a NRE account. The benefits of a NRE account is that the funds invested in NRE accounts are easily repatriable i.e it can be taken out of India easily. The fund invested in the NRE account has to be transferred from your overseas bank account and such NRE accounts cannot  be funded with Indian money. There are also some restrictions on investments. Click here to know the stocks restricted for NRE investments. 

     

    NRO account – The funds invested in a NRO account cannot be easily repatriated but has to follow certain procedures to take funds out of India. Funds can be repatriated up to $1 million in a year. Investments are however more liberal in NRO accounts unlike a NRE account. 



    What are the charges?


    NRI Account Opening Charges 


    Account opening fee – per account
      Rupees 5000 + 900 (GST at 18%)
    Total
      Rupees 5900

     

    Kindly note that NRE Equity Cash, NRO Equity Cash, and NRO F&O accounts are separate accounts


    Brokerage Summary:


    Tradeplus Brokerage for NRI Trading Account and NRI Demat Account is the best among the Stock Brokers in India:



    Brokerage and other charges.


    Expense HeadNRE Equity CashNRO Equity CashNRO - F&O
    Brokerage on Volume0.4%0.3%Rupees 49 per Traded Order
    GST on Brokerage @ 18%0.07%0.05%Rupees 8.82
    Securities Transaction Tax on  Volume0.10%0.10%Futures Sell - 0.01% on Volume
    Options Sell - 0.05% on Premium Value
    Options Exercised - 0.125% on the Settlement Value
    Transaction Charges0.00345%0.00345%
    Futures - 0.002%
    Options - 0.053% on Premium Value
    Clearing Member Charges--Futures - 0.0005%
    Options - 0.002% on Premium Value
    SEBI Turnover Charges0.0001%
    0.0001%
    0.0001%
    Stamp DutyDelivery Buy - 0.015%
    Intraday Buy - 0.003%
    Delivery Buy - 0.015%
    Intraday Buy - 0.003%
    Futures Buy - 0.002%
    Options Buy - 0.003% 
    MTF Account - InterestNot Applicable2% per month
    Not Applicable
    PIS Transaction chargesDiffers from Bank to bankNot ApplicableNot Applicable


    What basic information should I know about NRI Trade Account?


    As a NRI, you will first be to required decide which type of account you would like to open, whether a NRE account or NRO account or a F&O account. Note F&O account can only be in NRO mode. 

    The following accounts has to be set up based on the choice you make to invest in Secondary Market in India:


     To Invest in NRO (Non Repatriable Mode)


    1) Trading Account with Tradeplus

    2) Demat Account with Tradeplus

    3) NRO Savings Bank account with any bank in India. If you don't have one, Tradeplus will help you set up NRO bank account too.



    To Invest in NRE (Repatriable Mode)


    1) Trading Account with Tradeplus

    2) Demat Account with Tradeplus

    3) PIS (Portfolio Investment Scheme) Bank account with Axis Bank /  HDFC Bank / IDFC First Bank

    3) NRE Savings Bank account with any of the above mentioned bank


    Tradeplus serves as one stop solution to set up all the above accounts. After the initial paperwork all transactions in these accounts can be done online.


    What is a PIS Account?


    PIS or Portfolio Investment Scheme Bank account is a special type of account through which all transactions executed in the secondary market in NRE mode will be routed through. There are certain limits for NRI using NRE funds to invest in individual stocks and the limitation are monitored by RBI using the PIS accounts.

    Whenever a NRI, trading in NRE mode, buys or sells stocks in the secondary market, these are immediately reported to their banks which in turn report them to RBI. RBI will monitor the investment limits in individual companies based on the transactions reported to them. Hence, PIS bank account is mandatory for clients trading in Repatriable mode. This is however, not needed when a client trades in NRO (Non Repatriable mode).  


    How to open a NRI Trading account?


    It is easy to open an account with Tradeplus. Follow the steps given below to open one.

     

    1. Place a call request. You may alternatively email us at nriaccount@tradeplusonline.com or WhatsApp us at +91 73388 22169 / 91 9962017077 to call you.

    2. Speak to our Account opening Executive

    3. Share the required documents via email or WhatsApp

    4. Get a pre filled form emailed to you by our executive

    5. Download, verify, sign (you can also E-sign if you have Aadhaar card and the mobile number linked to Aadhaar Card) 

    6. Send us in original the Account opening form along with the documents to our office address


    What are the documents required to open an account?

    NRE account – Notarized and Self attested copies of 

     Card

    • Passport / OCI / PIO
    • Visa / Residence Permit Proof
    • Proof of Foreign Address such as Latest Bank account statement / Passport with address/ Driver's License/ Utility Bill etc.,
    • PIS & NRE Savings Bank application form – Tradeplus will help you open this with any of the below given banks

     

                            a) Axis Bank

                            b) HDFC Bank or

                            c) IDFC First

     

    NRO Equity Cash account – Notarized and self attested copies of 


    • Pan Card
    • Passport / OCI / PIO
    • Visa / Residence Permit Proof
    • Proof of Foreign Address such as Latest Bank account statement / Passport with address/ Driver's License/ Utility Bill etc.,
    • Cancelled cheque leaf or latest statement of any of your NRO Savings bank account


    You can setup a completely paperless NRO account within 15 minutes if you can E-Sign using your AADHAAR card.


    F&O Account


    For a NRI to trade in F&O, a trading account with CP Code needs to  be created. Tradeplus will open the F&O Trading account. Our partner, Orbis Financial Corporation, a Custodian to clear NRI F&O trades, will create the Custodial Participant Code (CP Code). The account opening kit will include Orbis papers as well. 


    Document required for NRO Derivatives account 


     2 sets of Notarized and self attested copies of 

     

    • Pan Card
    • Passport / OCI / PIO
    • Visa / Residence Permit Proof
    • Proof of Foreign Address such as Latest Bank account statement / Passport with address/ Driver's License/ Utility Bill etc.,
    • Canceled cheque leaf or latest statement of any of  your NRO Savings bank account

     

    Notes:

     

    1. 2 sets of Account opening forms along with 1 set of supporting documents are required to open a NRE and NRO Equity Cash account
    2. 2 sets of Account opening forms along with 2 sets of supporting documents are required to open a NRE Equity Cash and NRO F&O account
    3. 2 sets of Account opening forms along with 2 sets of supporting documents are required to open a  NRO Equity Cash and NRO F&O account


    Download, verify, sign and send us the Account opening document


    You will be required to download the pre filled form that our executive sends you, verify it, sign it, self attest and notarize the supporting documents and courier to our below given address:

     

        TradePlus Online

        NRI Divison

        No 9, IV Floor

        Ganga Griha

        Nungambakkam High Road

        Nungambakkam

        Chennai - 600034


    We will initiate the account opening process on receiving your original documents


    Is PIS Bank account required to open a NRO Trading?


    No, not required. Till recently, PIS Bank account was mandatory for NRE and NRO account and this is not required now for NRO accounts as RBI has scrapped it recently.


    To understand better, let's first understand the process involved in settling a NRI trade. Whenever, a NRI client trades, the transaction will first be reported to RBI. It will next be scrutinized for tax obligations, in case of sale transaction, and then be settled. For eg., if you buy 100 HCL tech at Rupees 850, the transaction will first be reported to RBI, your PIS  bank account will then be debited for Rupees 85000 + charges. When you sell these 100 shares at Rupees 950 each, the transaction will first be reported to RBI, then scrutinized for tax obligation. In this case it is a profit of 100x100 for which tax will be deducted and then the sale proceeds (after deducting the tax obligation) will be credited to the PIS account. Thus the purpose of this account is to route all purchase and sale obligations arising out of buying and selling shares in  the secondary market and reporting them to RBI. 


    RBI has now relaxed these procedures for NRO mode of trade. Under the new process NRO transactions need not be reported to RBI and hence, the trades executed in Non Repatriable mode need not be routed through PIS account. The transaction will however continue to be under scrutiny for tax obligations and taxes, if any, are to be paid before the sale proceeds gets credited to the account. This process is now done by Tradeplus at 0 cost. Hence, PIS bank account is not required any more to executed transactions in NRO mode and this means huge savings on transactions for you.


    How long does it take to open a NRI account?


    If all documents are in order, it can be opened in one working day.  





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