PIS Account for NRI

Non-Resident Indians can operate in the recognized stock exchanges and trade in shares and debentures of Indian companies. All you need to do is open a PIS account for NRI and reap the harvest in the secondary market. The NRI must route all the stock market investments through this account to comply with the governing regulations.

Read more
Best Investment Plans
  • Guaranteed Tax Savings

    Under sec 80C & 10(10D)
  • ₹ 1 Crore

    Invest 10k Per Month*
  • Zero LTCG Tax

    Unlike 10% in Mutual Funds

*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply

Grow Your Wealth !

Best Plans With High Returns Available On One Platform

+91
View Plans
Please wait. We Are Processing..
Plans available only for people of Indian origin By clicking on "View Plans" you agree to our Privacy Policy and Terms of use #For a 55 year on investment of 20Lacs #Discount offered by insurance company Tax benefit is subject to changes in tax laws
Get Updates on WhatsApp

What is Portfolio Investment Scheme (PIS)? 

The Reserve Bank of India (RBI) has devised the PIS to facilitate NRI investments in stocks and bonds.  Schedule 3 of the Foreign Exchange Maintenance Act, 2000 governs the scheme to monitor all stock market investments, whether credit or debit.  To invest in the stock market, you need to set up a PIS-enabled NRE or NRO account in any designated bank. The investment can be made on repatriation or non-repatriation basis.  

Why Do NRIs Need a PIS Account?

NRIs who want to earn good returns from investments in the Indian stock market has to hold a PIS account offered by the RBI mandatorily. The only catch for buying and selling Indian company stocks and convertible debentures is that you must operate through a registered broker in the recognized stock exchange. You are authorized to trade freely, barring intra-day transactions.  You get the following benefits with a PIS account:

  • Invest in the Indian stock market

  • Freely buy, sell, and repatriate

  • Seamless transactions

  • User-friendly operations

What are the Eligibility Criteria to Open a PIS Account?

The answer to the query “Is PIS account mandatory for NRI?” is “Yes,” you need to be aware of the eligibility conditions. Non-Resident Indian (NRI) and Person of Indian Origin (PIO)  are eligible to avail of the scheme according to the RBI guidelines. What is otherwise essential is to know the limitations. Accordingly, NRIs cannot open a PIS account, if:

  • A resident is traveling abroad for medical treatment

  • Residents traveling abroad on short trips

  • Bangladesh and Pakistan residents without prior RBI permission

  • Nepal and Bhutan residents

  • Mariners employed by Indian shipping companies

How Does the PIS Account for NRI Work?

You can freely invest in the Indian stock market either on repatriation or non-repatriation basis. However, you need PIS-enabled NRE or an NRO account to participate in share trading. The funds in the NRE account are eligible for repatriation in total, while the funds in the NRO account are repatriated after paying taxes. 

You must apply for designating the account under PIS after opening an NRE or NRO account through a specific application form. All the transactions through the designated account are reported to the RBI once approved. Then, you can start trading with the approved PIS account linked to the NRI Demat and NRI Trading account.  

What Are the Documents Required for a PIS account for NRI? 

You need to comply with the prescribed documentation to avail of the PIS account for the NRI facility. Having learned about the application procedure, you must be ready with documents specific to your NRI status. Accordingly, the indicative documents list is described below:

  1. For the NRI:

    • Valid Passport Copy

    • NRI Status proof

    • Proof of Address (POA) – both Indian and Overseas

    • PAN Card

    • Recent colored  photographs

    • FATCA

    • C-KYC

  2. For the PIO ( in addition to the above)

    • PIO Status Card 

    • PIO Declaration duly filled and signed 

What Are the Charges for Opening a PIS account for NRI?

Every service in the banking sector invites bank-specific fees charges. Some of the mandatory but indicative fees you pay for availing a PIS account for NRI are listed below for awareness. You must check with your bank for the specifications. 

  • PIS Issuance Charges: It is a one-time fee that you have to pay when you apply for the facility. 

  • PIS Account Maintenance Charge: The fee is levied by banks in defined periods specified for maintaining your account.

  • PIS Reporting Charge: You are required to pay the charge per trade date separately for purchase and sale regardless of the transacted value or quantity. Speak with your bank for fees charged to specific customer classes.

What Are the Benefits Provided by an NRI PIS Account?

The  benefits that are provided to PIS account holders are as follows: 

  1. Ease of Transactions: 

    Being an NRI, it is not always feasible for you to indulge in physical transactions. Your NRI PIS account takes care to ensure that you enjoy a seamless experience within the ambit of the rules and regulations. 

  2. Low-Cost Transactions: 

    All your stock investment transactions are compulsorily routed through the PIS account. Thus, the cost of transactions is kept low as an attraction.

  3. Seamless RBI Compliance:

    Your status and use of the PIS account for NRI for your stock market investments are monitored for every transaction. Therefore, you need not bother about RBI reporting norms and other statutory regulations as the account facilitates timely compliance on your behalf. 

  4. Value-Added Service:

    A specific feature suiting your NRI status is the Enhanced Set-off facility inbuilt in the PIS account for NRI. So what do you stand to get? Save on your Capital Gains Tax when you nullify the PIS transaction’s current losses against future profits.  Let us check how:

    • Loss set-off is permitted only on future profits and not earlier profits.

    • Carryover the losses to the final day of the financial year or till it is set off.

    • You cannot carry forward your profits, and the Capital Gains Tax is calculated on the net profit. 

    • You get the facility at the portfolio level during the financial year. 

The Final Words

The Indian capital market offers ample opportunities to explore investment options for NRIs. As an NRI, you must route your investments through the RBI-designed PIS accountThe scheme envisages multiple benefits to make your investment experience seamless. Is PIS account mandatory for NRI and its significance are amply explained, and there are no two opinions about it.

FAQ's

Written By: PolicyBazaar - Updated: 24 November 2021

Investment plans articles

Recent Articles
Popular Articles
How to Invest Money

25 Nov 2021

The investment made today is the asset created for tomorrow...
Read more
Gold Bonds in India for NRIs

24 Nov 2021

Gold is an asset whose value increases over time that may be...
Read more
Process to Fill SSY Form in Post Office?

20 Nov 2021

The Sukanya Samriddhi Yojana (SSY) is a post office scheme...
Read more
How to Fill a Post Office Savings Bank Form?

20 Nov 2021

Post Office Savings Bank Account is a deposit scheme with easy...
Read more
How to Pay Post Office RD Amount Online?

20 Nov 2021

Post offices in India offer several financial services to Indian...
Read more
Best LIC Policies For Investment in 2022
When it comes to purchasing a life insurance plan, 'LIC policies' are the most popular choice for customers. LIC...
Read more
Short Term Investments Options
Short-term investments can be described as temporary investments or marketable securities, which can be easily...
Read more
Post Office Monthly Income Scheme - MIS Interest Rate 2022
Are you looking for an investment avenue which is safe and secure, earns substantial returns with a short locking...
Read more
SBI Life Insurance Plans in India
SBI Life Insurance, a joint venture between State Bank of India (SBI) and BNP Paribas Assurance, provides...
Read more
State Bank Of India Investment Plans
Monthly investments plan is a popular investment options for individuals who wants to gain a profitable investment...
Read more
Close
Download the Policybazaar app
to manage all your insurance needs.
INSTALL