Can NRI invest in India without PIS? The answer is “Yes”. Are you an NRI hoping to invest in India without PIS permission, you can do so by opening an NRO non-PIS account.
The article covers all you need to know about no-PIS NRO Accounts including the types of NRI accounts, investment options available, charges applicable to NRO no-PIS NRI accounts, benefits, and how can NRI open NRO non-PINS trading account.
Let’s first understand what is NRO Bank Account.
NRO or Non-Resident Ordinary is a bank account for NRIs to manage the income earned in India.
NRI can have different types of income in India like rent, pension, dividend, etc. that can be deposited into NRO bank account. Thus, NRO account allows NRIs to deposit and manage all their rupee earnings from India at no hassle.
NRIs who wishes to use Indian income to invest in the Indian share market should consider opening NRO bank account.
NRO Account – Key Takeaways
NRO account is used to manage the income earned by NRI clients in India.
A non-resident can open NRO account with another NRI or Indian resident.
Internal fund transfer from NRE to NRO account is permitted whereas money in your NRO account cannot be transferred to NRE account.
Interest earned on the NRO account is subject to TDS.
Money from the NRO account is not fully repatriable as subject to a maximum ceiling of USD 1 million.
NRO Non-PIS account means NRO bank savings account in India without PIS permission.
Since PIS approval is not mandatory for NRO bank account, NRI is allowed to trade or invest in India through a no-PIS NRO trading account. It allows NRIs to use Indian rupee income as well as foreign earnings to invest in Indian stock exchanges.
NRIs can use a no-PIS NRO account to purchase and sell shares listed on BSE and NSE on a non-repatriation basis. It means, that money credited to your NRO account cannot be repatriated or transferred abroad. An NRI can withdraw or remit a maximum of USD 1 million in a financial year and that too after RBI approval.
NRO Non-PIS account – Key Takeaways
NRI does not require obtaining RBI PIS permission for NRO account to transact in the Indian stock market.
NRI can use NRO non-PIS account to invest in equities, convertible debentures, bonds, IPOs, and mutual funds.
A non-PINS NRO account allows NRI investment on a non-repatriable basis.
NRO non-PIS account can be opened with any bank in India, whether your broker has a tie-up with the respective bank or not.
There are 125+ banks available in India that allow non-residents to open an NRO bank account online in just a day.
NRI service offering stockbrokers in India offers online NRO non-PIS account opening facility.
All the NRI investment held through the NRO no-PIS account is considered as domestic investment.
An NRO account along with a NRI demat and trading account and a custodian account allows equity F&O trading.
No-PIS NRI transactions does not require RBI reporting.
NRI can link more than one NRO savings bank account to the trading account for investment.
NRO Non-PIS NRI Trading account and charges
NRI intend to trade with NRO mapped no PIS account requires the below accounts:
NRO Non-PIS Account Investment segments
Equity shares listed on BSE and NSE (Delivery trading)
Convertible debentures/preference shares
Exchange Traded Funds (ETFs)
Equity derivative (F&O) trading with custodial account
Mutual fund investment (Restricted for USA and Canada-based NRIs)
How to open NRO non-PIS Account?
Are you an NRI who want to invest in the Indian equity market without a PIS certificate? If yes, open a NRO non-PIS trading account.
You can open a NRO Bank savings account with more than 125+ banks in India. Indians who become NRI after shifting abroad can also convert their resident savings account to an NRO bank account, know more.
An NRI can directly approach stockbrokers too for NRO account opening. Full-service stock brokers are part of a bank and offers both NRE and NRO account and discount brokers have tie-ups with several domestic banks to allow NRIs to open NRO non-PIS account online. You have to provide your basic details, PAN details, and other required information to register E-KYC. Once the online process is done and you have submitted copies of the required documents to the bank, the NRO account will be opened.
NRO No-PIS NRI Trading Process
NRI investment routed through NRO non-PIS account works a similar way as that of residents in India. Check how NRI investment works in no-PIS mode:
Transfer funds from a linked NRO savings account to your trading account as per your requirements.
Place a buy/sell order in your choice of scrip.
Once the order is executed, the settlement process starts depending upon the amount of your trade order.
Funds available in your trading account can be withdrawn to the linked NRO account. NRI account holder can place a fund withdrawal request with the broker to get the money into their bank account.
NRO PIS Vs NRO Non-PIS Account
Although PIS authorized by RBI is not mandatory for NRO bank account. However, the choice is completely yours, whether to invest in India through PIS account or a non-PIS route. As a NRI, if you want to channel your investment through PIS mode, you can get PIS approval on your NRO account too.
In the PIS mode, the bank plays an important role in the settlement of all trades and reporting to the RBI.
Check out the differences between NRO PIS and NRO Non-PIS accounts:
Benefits of NRO Non-PIS NRI Account
Transact in equity shares, mutual funds, IPOs, ESOPs, bonds, etc.
You do not require a PIS letter which saves PIS account charges like account opening charges, and maintenance charges (AMC).
All the trades and fund settlements will be processed with the NRI broker.
NRIs with NRO accounts (PIS or no-PIS) permit trading in equity derivatives segment.
There is no investment cap or maximum limit on NRI investment channeled through the NRO non-PIS route.
NRO Non-PIS Account Opening Documents
Here are the documents an NRI needs to invest in the Indian share market through a non-PIS NRO trading account;
Foreign/overseas address proof
FEMA and FATCA declaration
NRO bank account proof or canceled cheque leaf
NRO Non-PIS Account Restrictions
As per regulations, BTST buy today sell tomorrow or short selling is not permitted to NRIs.
Commodity trading is not allowed.
NRI cannot trade in currency derivatives.
Frequently Asked Questions
What is no PIS account?−
PIS is not required for NRI investment in listed Indian companies with NRO savings bank account.
Can NRI invest in equity shares with no-PIS NRO account?+
Yes, all secondary market transactions channeled through NRO non-PIS trading account are permitted. However, to invest on repatriation mode using NRE account, it is necessary to get PIS certificate.
Why should an NRI open NRO non-PINS account?+
An NRO non-PINS account should be opened if,
NRI want to use income from India to invest in Indian equity market
NRI who wish to trade in F&O, a CP code is required
Investment held through non-repatriable NRO account
Less regulatory intervention as transactions are not reported to RBI
No maximum investment limit on NRO no-PIS account
Apply for IPOs permitted on both NRE or NRO no-PIS account
Invest in mutual funds (Not allowed to Canada and USA based NRIs)
PIS or Non-PIS account which is better for an NRI?+
As an NRI, both PIS and non-PIS accounts can be recommended that suit your investment requirements.
When to open NRE PIS Account?
NRI wants to invest their foreign earnings in India, NRE PIS is recommended.
NRI intends to invest on a repatriable basis or wants to remit funds abroad should open an NRE PIS account.
Invest in the Indian stock market using an NRE account, PIS is mandatory.
When to open NRO Non-PIS Account?
NRI wishing to park income earned in India can open a No-PIS NRO account.
NRO no-PIS is better to invest on a non-repatriable route.
If you have an NRO account, no need to obtain PIS approval as you can still invest in the Indian share market with a no-PIS NRO account.
Can an NRI convert no-PIS account to a PIS account?+
Yes, whenever you want you can convert NRE or NRO non-PIS account to a PIS account.
To do so, you have to submit a PIS application form to the respective bank where you have an NRI bank account. The designated bank on your behalf will submit the application to RBI to obtain PIS certificate.
You have to pay applicable PIS account opening fee, PIS account maintenance charges, and contract charges on the PIS account. Once your account is converted to PIS account, the fund settlement will be done through PIS account and there is no need to transfer funds to/from your trading account.
What is the NRO Account?+
The NRO Bank Account is Non Resident ordinary Account. With the NRO Account you have restricted repatriation of 1 million USD per annum. The money cannot be transferred from the NRO Account to NRE Account. An NRI with NRO saving account is no longer required to open PIS Bank Account for investment in Indian stock market.
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