Wealth Tips

NRI Mutual Fund Investment Options In India

August 25, 2020

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Looking for investment options in India? Wondering if NRIs can invest in Indian Mutual Funds? Relax, we've got the answers you're looking for.


We will tell you why you invest in India, how you can invest in India and also about the best ways to invest in India for good returns. 


Note: If you want a free personal wealth coach to help you through this Get The Cube App


Why Invest in India?


India is one of the fastest growing economies in the world and has huge potential for growth. The next benefit is that you will benefit from rupee appreciation. Going by the current state of the Indian Economy there is immense potential for profit seeking NRI investors and international investors in general.


Can NRIs invest in India?


Yes, there are rules and regulations governing NRI Investments in India but you can easily invest. You just have to adhere to the Foreign Exchange Management Act also known as FEMA. There are also a limited number of funds thay accept investments from NRIs.


You can either invest in mutual funds on repatriable basis or on a non-repatriable basis. If you wish to invest in a repatriable basis you need an NRE/FCNR account with an Indian Bank. If you're investing  on a non-repatriation basis you'll need an NRO account or NRE/FCNR as well.


Some examples of funds that accept NRI Investments include:


  • Sundaram Mutual Fund
  • Birla Sun Life Mutual Fund
  • ICICI Prudential Mutual Fund
  • DHFL Pramerica Mutual Fund
  • L&T Mutual Fund
  • PPFAS Mutual Fund
  • SBI Mutual Fund
  • UTI Mutual Fund



A Cube Wealth Coach can explain the basics for free, just email wealth@bankoncube.com with "Foreign Investment In India" in the subject line.


What are the Benefits of NRI investments in India?


If you're interested in returning to India it's a great way to participate in the economy while growing wealth. You will also be able to diversify (assuming you're invested in your current nation if residence as well). It is also easy to manage these investments online versus other investment modes that require your physical presence. 


How are NRI investments done in India?


Indian Asset Management Companies cannot accept foreign currency for payments. Therefore you must start by creating an NRO/NRE/FCNR account. 


Direct Investments


You can invest directly in Indian Mutual Funds by getting your KYC done. You will need basic documents like your PAN Card, Passport and Bank Account number. You may need to visit the Indian Embassy once in person. To get personalized advice on this please connect with the Cube Wealth team on wealth@bankoncube.com with "Foreign Investment In India" in the subject line.


Investments Through Power Of Attorney


NRIs can invest in India using power of attorney as well. Essentially you're giving some else POA to invest on your behalf.


Investing Through Cube Wealth


This is the easiest way for NRIs to invest in India. It's simple, automated and you get advice from the World's Best Wealth Coaches. 


  1. Download the Cube Wealth App
  2. Talk to our Wealth Coaches
  3. Start investing in your phone


Mutual Funds Taxation For NRIs


If India has signed the DTAA (Double Taxation Avoidance Treaty) with your country then you won't have to pay twice the tax. 


You will have to pay tax on your capital gains though - as you would have expected. 


Equity Funds Are Taxable based in holding period:


  • Short Term Capital Gains @ 15%. 
  • Long Term Capital Gains > Rs 1L @ 10%


Debt Fund Are Also Taxable Basis holding period:


  • Short Term Capital Gains @ 30%
  • Long Term Capital Gains > 3Yrs @20%


Want to Where to invest money for good returns in India?  Contact a Cube Wealth Coach by sending an email to wealth@bankoncube.com with "Foreign Investment In India" in the subject line.


FAQs - Frequently Asked Questions

Q. Can NRI open post office schemes?

Ans. Currently, NRIs are barred from investing in post office schemes. These schemes include instruments such as monthly income schemes, Public Provident Fund (PPF), National Savings Certificate, etc.

Q. Can NRI buy stocks in India?

Ans. An NRI can buy stocks in India through the Portfolio Investment Scheme of the RBI. It enables an NRI to acquire convertible debentures or shares from the stock market through a bank account with a nominated branch.

Q. Why do NRIs invest in India?

Ans. India is one of the fastest-growing economies of the world. The possibility of growth is great in emerging economies and it offers geographical diversification for NRI investors.

Q. Can NRI buy bonds in India?

Ans. An NRI can invest in bonds through the PIS Scheme of the RBI, much like they would invest in stocks. In April 2020, to allow NRIs to invest in specified government bonds, the RBI has also introduced a special channel – ‘Fully Accessible Route’ (FAR). This scheme is meant to operate along with the two existing routes: the Medium Term Framework (MTF) and the Voluntary Retention Route (VRR).

Q. Can NRI invest in mutual funds?

Ans. Yes, NRIs can invest in mutual funds in India, in fact, it is one of the most preferred investment options by NRIs. They can invest in mutual funds if they adhere to the provisions applicable in the Foreign Exchange Management Act (FEMA). Although a few mutual funds are restricted. You can either invest in mutual funds on a repatriable basis or on a non-repatriable basis. If you wish to invest in a repatriable basis you need an NRE/FCNR account with an Indian Bank. If you’re investing on a non-repatriation basis you’ll need an NRO account or NRE/FCNR as well.

In case you have not begun investing yet and are completely new to this, this episode of The Cube Wealth Show on How to Start Investing in Mutual Funds can be a good starting point.


Rishabh P Nair
Rishabh P Nair is the Head Of Brand Content at Cube Wealth. Rishabh has been weaving stories for over 10 years and prides himself on building brands with a strong identity. Besides building content for multiple start-ups, he has written scripts for YouTube videos, digital ads, short films, TV Shows and films.

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