Online/Off-line MF's transactions for NRI's !!
Hi Abhishek,
Thanks for this great information!!!
I do have an NRE and NRO account already opened in SBI but do not know if we can purchase these mutual funds online. Any website where I have to open an account in order to do so?
Thanks,
Satyeshwar
Bhai Satyeshwar
Let me tell you the investment procedure or the conditions through repatriable basis.
1) The mutual fund should comply with the terms and conditions stipulated by SEBI.
2) The amount representing investment should be received by inward remittance through normal banking channels or by debit to an NRE/FCNR account of the NRI investor.
3) The net amount representing the dividend/ interest and maturity proceeds of units may be remitted through normal banking channels or credited to an NRE/FCNR account of the NRI investor, as desired by him subject to payment of applicable tax.
Investment procedure or conditions through non-repatriable basis.
1) Funds for investment should be provided by debit to NRO account of the NRI invester.Alternatively funds may be invested by inward remittance or by debit to NRE/FCNR account.
2) The current income in the form of dividends is allowed to be repatriated.
Now coming back to your point how to purchase the MF's?
There are two ways either online purchase or off-line purchase.
Taking consideration to your case as you have already an NRE/NRO account opened in SBI. You can purchase MF's online provided you have internet banking access to your NRE account with SBI. Before, you may go ahead, you will have to get for yourself a Mutual Fund Identification Number (MIN) which is mandatory for all MF's investments.Once you have the MIN you can choose the scheme you wish to invest say for your case SBI Mutual Funds you can visit this page
www.sbimf.com rest is simple. All you have to do is to ensure that you have funds in your NRE SBI account and remember your userid and password to access this account. Note for your information these transactions takes place outside of the US and therefore US securities laws and investor protection do not apply. In cut short Uncle SAM will not interfere your transactions.
Now the off-line procedure to purchase MF's.
Every bank has a post name Investment Advisor.They are proffesional fund managers and will provide operational assistance while investing in MF's. Procedure is simple advisor understand your needs and recommends a schemes or multiple schemes, accordingly. The form can be emailed to you, you can sign and send the application form by post/courier. A demand draft could be ordered through the bank to be delivered directly to your advisor. This prevents the loss of cheques in transit. The advisor than acknowledges receipt of the forms and draft to you by email or can send you a copy of filled application form to you for your records. The investment form is sent to the respective fund house and you receive the account statement via email.Then the advisor will send you periodic updates of the portfolio and also recommends any changes that need to to be made due to any change in the circumstances say markets runs up too high or banking losses bla bla ..
In case if you made switches or redemptions, your advisor is also expected to keep record of the switches made and also confirm with you if you have received the redemption proceeds directly in your bank account.
Few valuable tips which normally helps NRI !!
1) NRI can gifts the units of MF's to any Resident Indian or an NRI. Such units gifted by any person would not be liable to any Gift Tax since the units held under the schemes are also not subject to provisions on the Gift Tax act 1958.
2) MF's units issued to investor including NRI's will not be treated as assets as defined under section 2(ea) of the Wealth Tax Act, 1957 and hence will not be liable to wealth tax.
Hope the things are clear to you as of now.
