There are various types of Demat accounts that are available, namely regular, repatriable, and non-repatriable. While these are available to all individuals, the usage primarily depends on their residency status. For instance, Non-Resident Indians (NRIs) can choose between the repatriable and non-repatriable account, depending on whether they prefer to transfer funds abroad or not.
If you wish to conduct transactions within the country and transfer your funds abroad, you can opt for a repatriable account. Read on to learn more about this type of account in the following sections.
A repatriable Demat account is a type of Demat (Dematerialised) account designed for Non-Resident Indians (NRIs). The account facilitates their investment in the Indian stock market and other eligible securities while allowing them to repatriate or transfer funds back to their foreign bank accounts. By opening a repatriable Demat account, account holders are required to adhere to the rules laid out by the Foreign Exchange Management Act (FEMA).
Furthermore, you are required to link your Demat account with your Non-Resident External (NRE) Accounts, unlike regular Demat account holders. However, it is important to note that the ability to transfer funds abroad is dependent on the regulations and laws of both the citizen and the residing country.
A repatriable Demat account, which allows non-resident Indians (NRIs) to invest in India and repatriate funds abroad, typically offers these key features:
NRIs can use a repatriable Demat account to invest in Indian stocks, mutual funds, bonds, and other eligible securities.
This type of account allows NRIs to transfer funds from the Demat account back to their foreign bank accounts, making it convenient for repatriation of profits and investments.
NRIs can hold a repatriable Demat account jointly with other NRIs or with resident Indians.
The account holder can nominate a person to receive the securities and funds in case of the account holder's demise.
Most repatriable Demat accounts offer online trading platforms, making it easy to buy and sell securities from anywhere in the world.
Certain repatriable investments may offer tax benefits and exemptions for NRIs, subject to Indian tax laws.
NRIs can efficiently monitor their investment portfolio, holdings, and transaction history online.
Many banks and brokers provide specialised customer support and services tailored to the needs of NRIs.
NRIs can convert their physical share certificates into electronic form by dematerializing them and holding them in the repatriable Demat account.
NRIs can appoint a Power of Attorney (PoA) to manage their account and investments, granting authority to make investment decisions.
On becoming an NRI, individuals can either choose to convert their resident account to an NRO account or keep the assets in their account on a non-repatriable basis. Additionally, they can transfer securities to Indian relatives and close the account.
The primary difference between the two types of Demat accounts is the ability to transfer funds abroad. While repatriable Demat accounts allow transferring funds overseas, a non-repatriable account does not permit this, with the exception of dividends and interest earnings.
Yes, NRIs can open as many Demat accounts as they wish to, including NRO and NRE accounts.
NRIs, PIOs and OCIs are eligible to open repatriable Demat accounts.
Yes, NRIs can hold a joint repatriable account with another NRI or a resident Indian. However, some restrictions may apply, depending on the type of securities.
Yes, different types of investments may have different tax treatments, and tax benefits may be available depending on the prevailing Indian tax laws and DTAA.