Which demat account is best for NRIs

Which demat account is best for NRIs

We all know that a demat account is needed for making transactions on the stock market. But what is the procedure for opening one if you are a non-resident Indian (NRI) and which is the best demat account for NRIs? Let’s find out.

Procedure for NRI demat account

A Non-Resident Indian or NRI is defined is someone with an Indian passport, who, by definition, does not reside in India. Any Indian citizen, who spends more than 180 days abroad, in a calendar year, is regarded as an NRI. The procedure for opening an NRI demat account is the same as that for resident Indians. You need to fill in a demat account opening form, and provide proof of identity and residence, like passport, PAN card etc. as per the official valid documents (OVD) list.
NRIs can open three-in-one accounts that can combine banking, trading and demat services. You can open either non-resident external (NRE) or non-resident ordinary (NRO) accounts. However, NRIs have to invest in shares and debentures through secondary market only through the Portfolio Investment Scheme (PINS), which is available only at designated branches. According to RBI guidelines, NRIs need to open a separate bank account exclusively for PINS, and this account should be held individually, not jointly.
You will need an NRE account if you want to repatriate funds abroad. If you don’t, an NRO account will suffice. Note that banks offering demat services, do not usually offer three-in-one accounts to NRIs and PIOs (persons of Indian origin) living in the USA or Canada.

Trading account

In order to trade in Indian stocks and shares, NRIs will also need a trading account. Most banks provide trading services along with PINS accounts, so NRIs can execute trades i.e. buy and sell shares through these accounts, while the shares are held securely in the digital format, in their demat accounts. NRIs can also open a Non-PINS account which is essentially required for all IPOs and MF investments and also to sell shares, which were acquired as resident Indian.

Benefits of demat account

NRIs can benefit from opening a demat account since it will allow them to invest in Indian stocks and shares. The process is fast and simple, and can be done quickly. Investing in the Indian markets provides them an opportunity to create a corpus that can prove incredibly useful – whether or not the NRI returns to India in future. Even if you don’t plan to come back, investing in Indian stock markets is a good option since emerging markets offer much better returns than the mature economies of the west.

Best demat account for NRI

As an NRI, you may have logistical concerns. You cannot visit India each time you wish to invest in something or have some issue sorted. You may also need additional services, including advisory services to keep you on top of upcoming investment opportunities. While you can trade online, you can get the necessary information to make informed investment decisions, if you choose the right demat service provider. It is recommended that you opt for a reputed brokerage firm with years of experience in the investment market. ICICI bank’s investment arm, ICICIdirect for instance, offers seamless, excellent quality services for NRIs, making it one of the best demat accounts you can opt for.