NRI Demat Account

An NRI (Non-Resident Indian) Demat account is a specialised Demat account structure that enables Indian citizens residing abroad to hold and trade in Indian securities — equity shares, mutual fund units, bonds, ETFs, and government securities — in compliance with the Foreign Exchange Management Act (FEMA) and SEBI regulations. NRI investors can open two types of Demat accounts linked to their residential status: a Repatriable Demat account (linked to an NRE — Non-Resident External — bank account) which allows investment proceeds and capital gains to be freely repatriated abroad in foreign currency, and a Non-Repatriable Demat account (linked to an NRO — Non-Resident Ordinary — bank account) where funds cannot be freely repatriated without RBI approval and are subject to Indian tax on income. NRI equity investment limits and sector-specific caps are governed by RBI's regulations under FEMA and the Foreign Portfolio Investors framework. NRIs from the United States and Canada face additional restrictions due to compliance requirements of US securities regulations — many Indian brokers and banks have specific NRI trading accounts for FATCA-compliant investors. SEBI and RBI have progressively simplified the NRI investment framework over the years to encourage the Indian diaspora's participation in India's capital markets growth story.