Who can be called a Non Resident Indian (NRI)?
A non-resident Indian (NRI) is a person resident outside India who is an Indian citizen who stays abroad for employment / carrying on business or vocation outside India or stays abroad under circumstances indicating an uncertain duration of stay abroad or a person of Indian origin resident outside India and includes a student who has gone outside India for further studies.
Who can be called as a Person of India Origin (PIO)?
A Person of Indian Origin means a citizen of any country (other than Bangladesh or Pakistan), if:
· he at any time held an Indian passport; or
· he or either of his parents or grand parents was a citizen of India by virtue of the Constitution of India or the Citizenship Act,1955 (57 of 1955); or
· he is a spouse of an Indian citizen, or of a person referred to in (a) or (b) above.
Who is a Foreign Institutional Investor (FII)?
An FII means an institution established or incorporated outside India , which proposes to make investment in Indian securities, and is registered with SEBI.
Can an NRI maintain a bank account in India ?
Yes. NRI's can maintain accounts in rupees as well as in foreign currency. Accounts in foreign currencies can, however be maintained in India with authorized dealers only.
What are the different types of Bank Accounts permitted to be maintained by NRIS/ PIO s?
The different kind of Bank Accounts and their characteristics are depicted in the following table:
| Particulars | Non Resident [External] Rupee Account Scheme (NRE) | Foreign Currency Non resident Bank Account Scheme (FCNR) | Non Resident Ordinary Rupee Account Scheme(NRO) |
| Account Maintained in currency | Indian Rupees | US $, GBP, Yen, Euro, DM, Pound Sterling | Indian Rupees |
| Account type and tenure | Normal Bank Account | Term Deposit for a specific period of 1 year and above but less than 2 years, 2 years and above but less than 3 years and 3 years. | Normal Bank Account |
| Whether Repatriable | Yes. Deposits as well as interest are repatriable. | Yes. Deposits as well as interest are repatriable. | No. Only interest is repatriable. |
| Investment could be done in Mutual Fund | Yes | Yes | Yes |
What is the procedure for Investment of NRI/PIO/FII
The following summary outlines the various provisions related to investments by Non-Resident Indians ('NRI's'), Persons of Indian Origin ('PIO s') and Foreign Institutional Investors ('FII s') in the Schemes of the Mutual Fund and is based on the relevant provisions of the Income-tax Act, 1961 (the 'Act'), regulations issued under the Foreign Exchange Management Act, 1999 and the Wealth-tax Act, 1957 (collectively called 'the relevant provisions'), as they stand on the date of this abridged Offer Document.
The following information is provided for general information only. However, in view of the individual nature of the implications, each investor is advised to consult with his or her own tax advisors / authorized dealers with respect to the specific tax and other implications arising out of his or her participation in the schemes.
Purchase Applications
1. NRI s and other overseas investors can invest in a Mutual Fund Schemes on Repatriable /Non-Repatriable basis as per the provisions of Schedule 5 of the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000 (the 'Regulations') as explained below. A Common Application Form duly completed together with cheques or bank drafts should be remitted through Investor Service Centres ('ISC').
2. All Cheque/demand drafts accompanying the application form must be made in favour of "Selected Mutual Fund - Scheme Name" and crossed "A/c payee" only and should be made payable at a city where the application is accepted by the Mutual fund ISC or any Karvy ISC.
- Once an account is opened the investor may purchase additional units by filling-up the Common Application Form or by simply filling in the account number in the application form and mailing the same to a Mutual FUND ISC, along with the cheque or the bank draft.
Repatriable Basis - NRI s, PIO s
In case of NRI's, PIO's seeking to apply for purchase of units on a repatriable basis, payments may be made by way of inward remittances, or by way of cheques drawn on the NRE/FCNR Account of the investor [Clause 3(2) of the Regulations] payable at the city where the application form is accepted by any Mutual Fund ISC.
Non-Repatriable Basis - NRI s, PIO s
In case of NRI s/PIO s seeking to apply for units on a non-repatriable basis, payments may be made by way of inward remittances, or by way of cheques/demand drafts drawn on the NRE/FCNR/NRO account of the investor [Clause 3(3) of the Regulations], payable at the city where the application form is accepted by any Mutual Fund ISC.
