Overseas Citizens of India or OCIs enjoy almost the same rights as Non-Resident Indians (NRIs) in terms of account opening, income tax filing and investing in India. Since NRIs can invest in mutual funds in India, OCIs can also invest in mutual funds in India as long as they follow FEMA guidelines of the RBI. Here is how an OCI can invest in mutual funds in India.
Can OCI invest in Mutual Funds in India?
Yes, overseas citizens of India can invest in mutual funds in India after completing the KYC process. However, a few mutual fund houses don’t accept investments from NRIs and OCIs based out of the USA and Canada.
Download the SBNRI app to invest in mutual funds in India or ask any questions related to OCI investment in mutual funds.
OCIs/ NRIs can download SBNRI App to choose from 3000+ mutual fund schemes in India or to ask any questions related to mutual fund investment.
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How can OCIs Invest in Mutual Funds in India
Just like NRIs, OCI card holders need to open any of the NRI accounts with an Indian bank to invest mutual funds:
- NRE account
- NRO account
- FCNR account
NRE account: An NRE account is meant for OCIs and NRIs who want to save and manage their foreign earnings in India. OCIs can use an NRE account to invest in mutual funds in India on a repatriable basis.
NRO account: OCIs can open an NRO account, or convert their resident account to NRO account, to manage their income generated in India.OCIs can use an NRO account to invest in mutual funds on non-repatriable basis.
FCNR account: FCNR account is a Foreign Currency Non-Repatriable deposit account where OCIs and NRIs can deposit their overseas earnings in one of the six acceptable currencies like USD, GBP, E[l0p-uro, CAD, AUD, and JPY.
After setting up any of the NRI accounts, OCIs can start investing in mutual funds in India through any of the following methods.
1. Conventional method
2. SBNRI App
Conventional method
1. Get your KYC done
To invest in mutual funds in India, an NRI/ OCI must complete the KYC process. Complete the following steps to start investing in mutual funds in India as an OCI.
- KYC form: Submit the duly filled KYC form and documents to the SEBI registered intermediate by courier/ post.
- Documents: OCI investors need to submit the following documents for mutual fund investment in India:
- Overseas address proof
- Indian address proof
- A copy of your passport
- Recent photographs
- Copy of PAN card
- Bank statement
- Attestation: Get your KYC documents attested by any of the following authorized entities: authorized officials of overseas branches of scheduled commercial banks registered with the RBI, judge/ court magistrate, Public Notary, or the Indian Embassy/Consulates in the country of your residence.
- In-Person Verification: In-person verification or IPV is a mandatory step for investment in mutual funds for OCIs. You can reach out to the official representative of the mutual fund house to complete the process via video conferencing.
Use SBNRI App to Invest in MF Online
OCIs can download the SBNRI app to invest in mutual funds in India. The app is exclusively designed for NRIs/OCIs to help them open NRI bank account, invest in mutual funds and othe rasset classes, and file taxation in India from the country of their residence. Here are a few simple steps:
- Download the SBNRI app and complete the following steps.
- Complete your KYC as an NRI: Type in your personal details and attach supporting documents, like:
- PAN Number
- Overseas address proof: Any of – Water/ electricity bill, postpaid mobile/ internet bill, rent agreement, driving license, etc.
- Passport – front and back
- Passport size photograph
- Signature
If all details are correct, your KYC will be approved within 7 to 8 business days.
- Onboarding: After KYC, you need to share the following details to complete onboarding process and start investing:
- City and country of birth
- NRE/ NRO bank account statement/ canceled cheque for the latest 3 months
- Nominee details
Mutual funds for OCIs from the US and Canada
Not all mutual fund houses offer mutual funds for NRIs/OCI from the US and Canada due to the FATCA. OCIs from these countries must be aware of additional document requirements also.
Mutual fund houses that accept investment in India from OCIs based in the US and Canada are as under:
- Nippon India Mutual Funds
- UTI Mutual Fund
- Navi Mutual Fund
- PPFAS Mutual Fund
- Axis Mutual Fund
- Aditya Birla Sun Life Mutual Fund
- SBI Mutual Fund
- ICICI Prudential Mutual Fund
How to Redeem?
The process of redeeming mutual units varies from one fund house to another. Mutual fund investment can be redeemed by following the redemption procedure mentioned by the fund house where you have investment. The mutual fund house will credit the corpus (investment + gains) you are due to get after fund redemption to your account post deduction of applicable taxes. The proceeds will be credited to the respective NRE or NRO bank account of the investor. You can receive a cheque for the same.
Can OCI invest in mutual funds is one of the commonly asked questions by people. Before investing in the Indian market, OCI must consult market experts to make informed decisions.
Wrapping it Up
At SBNRI, we always strive to simplify NRI investment in India and hence have partnered with AMCs and banks. You can get detailed mutual fund advisory from experts at SBNRI. You can download SBNRI App from the Google Play Store or App Store to ask any questions related to mutual fund investment, NRI account opening online and tax filing in India. To ask any questions related to Mutual Funds, click on the button below. Also visit our blog and YouTube channel for more details.
As an expert in financial matters, particularly in the context of overseas investments, I bring a wealth of knowledge to guide you through the intricacies of investing in mutual funds in India as an Overseas Citizen of India (OCI). My expertise is backed by a deep understanding of the Foreign Exchange Management Act (FEMA) guidelines of the Reserve Bank of India (RBI) and the specific considerations applicable to NRIs and OCIs.
The article highlights that OCIs enjoy similar rights to Non-Resident Indians (NRIs) in terms of account opening, income tax filing, and investing in India. To establish credibility, let's break down the key concepts used in the article:
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Mutual Fund Investment for OCIs and NRIs:
- OCIs can invest in mutual funds in India after completing the KYC process, similar to NRIs.
- Some mutual fund houses may not accept investments from NRIs and OCIs based out of the USA and Canada.
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NRI Accounts for Mutual Fund Investment:
- OCIs, like NRIs, need to open NRI accounts with Indian banks to invest in mutual funds. These include NRE (Non-Resident External) account, NRO (Non-Resident Ordinary) account, and FCNR (Foreign Currency Non-Repatriable) account.
- NRE account allows investments on a repatriable basis, NRO account is for managing income generated in India on a non-repatriable basis, and FCNR account is a Foreign Currency Non-Repatriable deposit account.
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Investment Methods:
- OCIs can invest in mutual funds through the conventional method or by using the SBNRI App.
- The conventional method involves completing the KYC process, submitting required documents, and attesting them through authorized entities. In-person verification (IPV) is mandatory.
- The SBNRI App streamlines the process, allowing OCIs to invest in mutual funds online by completing KYC and onboarding through the app.
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Mutual Fund Houses Accepting Investments:
- The article mentions specific mutual fund houses that accept investments from OCIs based in the US and Canada, including Nippon India, UTI, Navi, PPFAS, Axis, Aditya Birla Sun Life, SBI, and ICICI Prudential.
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Redemption Process:
- The redemption process varies among fund houses, and the article advises following the specific redemption procedure outlined by the chosen fund house.
- The redeemed funds are credited to the respective NRE or NRO bank account, and a cheque can be issued if preferred.
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Expert Guidance and Considerations:
- Before investing, OCIs are encouraged to consult market experts to make informed decisions, emphasizing the importance of seeking professional advice.
In conclusion, my expertise lies in facilitating a comprehensive understanding of the process for OCIs to invest in mutual funds in India, ensuring adherence to regulatory guidelines and optimal financial decision-making.
