NRIs are
permitted to invest in shares / convertible Debentures of
Indian companies by RBI, under portfolio investment (PIS) in
secondary market through registered Broker on a recognized
Stock Exchange by RBI, under Portfolio Investment Scheme (
PIS).
Portfolio
Investment Scheme Account
Portfolio
Investment Scheme (PIS) is a scheme of the Reserve Bank of
India defines the Non Resident Indians can purchase and sell
shares and convertible debentures of Indian Companies on a
recognized stock exchange in India by routing all such
purchase/ sale transaction through their a/c held with a
designated bank branch. PIS account is one type of saving
account with bank only for NRI’s secondary market
transaction.
Any NRIs
want to trade/make fresh investment in the Indian equity
secondary market needs and must have one PIS account with
only one designated bank in India.
Note :-
•
PIS a/c is only for
NRIs
•
It is only for
trading in Indian market not for foreign market.
•
It is applicable
only for equity trade not for MFs investment.
PIS
Account-Eligibility
Foreign
Institutional Investors (FIIs), Non-Resident Indians (NRIs),
and Person of Indian Origin (PIOs) are allowed to invest in
the secondary capital markets in India through the portfolio
investment scheme (PIS). Under this scheme, FIIs/NRIs can
acquire shares/debentures of Indian companies through the
stock exchanges in India.
Ceiling-PIS
Scheme
The
ceiling for overall investment for FIIs is 24 per cent of
the paid up capital of the Indian company and 10 per cent
for NRIs/PIOs. The limit is 20 per cent of the paid up
capital in the case of public sector banks, including the
State Bank of India.
Non-Resident
(External) - [NRE]
A NRE
bank a/c is an external saving bank a/c opened for NRIs.
This is why it is known as Non-Resident External Accounts.
Since it is external a/c, any monies lying in NRE account
can be taken out side the country or in other words, the
money lying in NRE a/c are fully repatriable. This money can
be converted into any foreign currency at the behest of the
account holder and can be remitted outside the country.
Non-Resident
(Ordinary) - [ NRO]
A NRO
bank a/c is an ordinary saving bank a/c opened for NRIs.
This is why it is known as Non-Resident Ordinary a/c. Since
it is an Ordinary account i.e. as good as a normal savings
bank a/c, money lying in NRO account can not be taken out
side the country or in other words, the money lying in the
NRO a/c is not Repatriable.
Trading
Account
A Trading
Account will enable you to buy and sell shares in the
secondary market. The trading account must be in the name of
an individual but the account can be tied to a jointly held
depository account provided the trading account holder is
any one of the holders of the joint depository account.
Demat
Account
Most
shares being available only in the electronic form, a
Depository account is a precondition for trading in the
secondary market. Kunvarji is a registered member
(Depository Participant) of CDSL. You can avail of all the
depository-related services by just opening an account with
CDSL through Kunvarji.
