One of the world’s fastest growing equity markets is the Indian share market. Due to various benefits, Non-Resident Indians (NRIs) are coming on board in addition to Indian investors to profit from the expanding Indian equity market. Any investor, whether an Indian or an NRI, must open Demat and Trading accounts from reputed brokerage firms, and others to trade or invest in stocks. Right now, most Indian share market apps make it incredibly simple to open a Demat and Trading account.
Now, one question may come to your mind: How do you find the best trading app for NRIs to invest in the nifty stock market? Here you can find all the details you should know. Alternatively, you may explore blogs from platforms like mStock.
What is an NRI trading account?
When trading financial assets like equity shares, bonds, mutual funds, an NRI trading account serves as the intermediary. When you invest in mutual funds or purchase shares, they are added to your Demat account through your online trading app.
NRI Demat or Dematerialized accounts provide online storage for investors’ digital stocks. The depository institutions that look after investors’ Demat accounts in India are CDSL (Central Depository Services Limited) and NSDL (National Securities Depository Limited). Shares traded on the BSE are stored by CDSL, while shares traded on the NSE are stored by NSDL. A unique sixteen-digit number known as the Demat account number allows access to various financial products, option chain data and more.
Different types of NRI trading accounts
NRI trading accounts have different kinds of specifications. Based on those specifications, major two types are as follows:
- NRE (Non-Resident External) Trading Account: NRIs who keep their money in freely transferable Non-Resident External (NRE) accounts can open an NRE Trading Account.
- NRO (Non-Resident Ordinary) Trading Account: NRIs who hold their money in Non-Resident Ordinary (NRO) accounts, which are not subject to free relocation, should consider opening an NRO Trading Account.
Features of NRE trading account:
- The currency of the NRE Trading Account is the Indian Rupee (INR).
- There are no restrictions on the free repatriation of funds held in the Trading Account, including the proceeds from the sale of securities.
- Funds from outside of India, or foreign income, are used to fund the NRE Trading Account.
Features of NRO trading account:
- The NRO Trading Account uses Indian Rupees (INR) as its currency.
- Funds held in the NRO Trading Account are subject to repatriation restrictions, unlike those in the NRE Trading Account. Repatriation must receive prior authorization from the authorized bank and is subject to several restrictions.
- Rent, dividends, pension payments, and any other Indian income sources fund the NRO Trading Account.
What are the benefits you can get from an NRI trading account?
Various online share market trading apps are easily available for opening NRI trading accounts. So invest in sip, stocks easily, even as a non-resident.
What’s more:
You can take the help of a share trading app to open a trading account and manage your investment portfolio. However, be aware that not all platforms offer these accounts. Make your decisions thoughtfully.
