Artham Finserve Pvt. Ltd. has also forayed into ‘Global Investment Services’ by assisting the Non Resident Indians (NRIs) from abroad to make informed investment decisions in the Indian Financial Markets as far as various options like Stock Market, Mutual Funds, Retirement / Insurance, Fixed Deposits; Government Bonds & Securities etc. are concerned. Artham Finserve Pvt. Ltd. offers NRI Investment Service in Surat by making the NRIs aware of various investment opportunities to our NRI clients globally.
Resident Indian to Non Resident India
Different rules apply for a Resident Indian when his status changes to a Non-Resident Indian. On becoming an NRI, a person needs to carry out certain formalities with respect to his existing investments and bank accounts.
Bank Account: Once a person changes is status from Resident Indian to NRI, he can no longer operate his Resident savings account. He needs to open a Non-Resident External (NRE) /Non-Resident Ordinary (NRO) account with the Bank Investments can be routed only through NRE/NRO account. Bank fixed deposits should also be converted to NRO fixed deposits and the original fixed deposit receipt has to be submitted and a new deposit confirmation advice with the applicable terms & conditions will be issued.
Since NRE- Non- Resident External Account is an external account, the money lying in NRE account is fully repatriable; which can be converted into any foreign currency. This money can also be remitted outside the country. Money can easily be transferred from NRE Account to NRO Account.
Money lying in NRO- Non-Resident Ordinary Account can’t be transferred to NRE Account. Mistakenly transferred money from NRE to NRO account can’t be transferred back to NRE account. Repatriation in case of NRO is restricted. Money to the limit of 1 million USD per year can be repatriated after RBI reporting through supported applications – 15CA & CB. Moreover an NRI can execute trades through relatives in India by giving Power of Attorney (POA).
Demat Account: A person may be holding securities in a demat account in the Resident status. On becoming NRI, a new depository account with NRI status needs to be opened. All the balances held in account with ‘Resident’ status should be transferred to new account. Securities held under this account will be treated on non-repatriable basis. In case of physical securities held by the resident investor, an NRI needs to regularise his holdings to reflect NRI status. For this, NRI must submit a letter addressed to this issuing company along with the Demat Request Form stating change of status and giving details of foreign address.
Trading Account: On becoming NRI, a new trading account needs to be opened for future investments. NRI trading accounts usually have higher brokerage rates compared to Resident Investors. NRI can continue to hold the securities that were purchased as a Resident Indian, even after he becomes a non- resident Indian, on non- repatriable basis.
PIS Account: Portfolio Investment Scheme (PIS) is a scheme of Reserve Bank of India—enables NRIs and *OCBs (Overseas Citizens of India) to purchase and sell shares and convertible debentures of Indian companies on a recognized stock exchange by routing such purchase/sale transactions through their NRI Savings Account with a designated bank branch. PIS is required because any NRI can’t invest more than 5% in any Indian company. And as per the regulations of FEMA, companies listed on Indian stock exchange can’t have more than certain limit of foreign investments.
(* OCI- Under OCI Scheme operational from 02nd Dec 2005 government of India decided to grant overseas citizenship of India (OCI) commonly known as “dual citizenship”. A foreign national, who was eligible to become a citizen of India on 26.01.1950 or was a citizen of India on or at anytime after 26.01.1950 or belonged to a territory that became part of India after 15.08.1947 and his/her children and grand children, provided his/her country of citizenship allows dual citizenship in some form or other under the local laws, is eligible for registration as an Overseas Citizen of India (OCI). Minor children of such person are also eligible for OCI. However, if the applicant had ever been a citizen of Pakistan or Bangladesh, he/she will not be eligible for OCI.)
PINS Account:
Any NRI/PIO willing to trade or invest in Indian Secondary market must have a PINS Account. PINS can only be used by the NRIs to trade in Indian Market for trading equity and not investing in Mutual funds. Any NRI can only have one PINS account in India with only one bank. NRI should have separate bank account exclusively for PINS purpose. Other transactions should be done through Savings Accounts. The type of Rupee accounts permitted to be maintained for PINS are- 1. Non Resident (External) Rupee Account (NRE PINS Account) and Ordinary Non- Resident Rupee Accounts (NRO PINS Accounts) are permitted to be maintained for PINS.
NON PINS Account: An account for which the transactions are not reported to RBI is known as Non-PINS. Selling of all the shares, which are not allowed under PINS are taken care by Non-PINS account. Shares acquired through IPO or obtained as a gift or bought as Resident Indian can be sold through Non-PINS Account. It is a normal savings bank account which can be opened with any bank in India. Non-PIS is an account for which the transactions are not reported to RBI.
Repatriability: ‘Repatriable’ & ‘Non Repatriable’ – When an investor brings money to India and does not want to take it back to his home country, he can make the investments using NRO account. Such investments are said to be done on ‘Non-Repatriable’ basis. But if he decides to take the principal plus the profits back to the home country; then he would essentially need an NRE account. In NRE accounts, he would be allowed to take out the principal and the profits, after paying necessary taxes. It is called ‘Repatriable Investment’.
NRI to Resident Indian
NRI: An Indian citizen or a person of Indian origin who is residing outside India is called an NRI (Non-Resident Indian). A resident is an Indian citizen, who has stayed in India for at least 182 days in a financial year.
Person of Indian Origin (PIO): An NRI under Indian Income Tax Act is defined as a Person of Indian Origin (PIO) if he or she:
- Has held an Indian passport at any time, or
- Is a grandchild of citizens of India, or
- Is a spouse of an Indian citizen, or
- Is a spouse of a person covered under the first two points mentioned above.
If a person returns to India and forgoes the NRI Status, he needs to carry out certain procedures with respect to his investments & bank account.
Bank Account: Once an NRI becomes a RI, he cannot operate his NRO/ NRE/FCNR (B) accounts. He needs to inform to the bank about the change of status to resident Indian and needs to open a Resident Rupee Account. Account opening documents such as address proof, identity proof, photographs need to be submitted. A Resident Foreign Currency (RFC) account may be opened by returning Indian to transfer balances from NRE/ FCNR (B) accounts. This account can hold foreign currency and continue to receive funds in foreign currency from investment broad.
Demat Account: Just like Bank Account, the returning NRI needs to inform change of status to the designated authorised dealer branch through which the investor had made investments in the Portfolio Investment Scheme, as well as the DP with whom he has opened a demat account. A new demat account with ‘Resident’ status needs to be opened. All the balances held in the NRI demat account hall be transferred to the new ‘Resident’ demat account. After transfer, the NRI demat account shall get closed.
Trading Account: If the NRI was operating an online trading account, the broker also needs to be informed about the change. The trading account with NRI status will get closed and a new trading account with resident status needs to be opened.
Mutual Fund Investments: Respective AMC with whom the NRI holds mutual fund investments needs to be informed about the status change. KYC Change Form needs to be sent to the KYC registration agency for change of status, address and bank details. An acknowledgement shall be issued by the KYC registration agency on submission of request and will carry out the necessary changes in its records.
Process
Understanding the need of the investor before investing their money is our utmost priority. We have our pre-defined process in place for giving insights to each client after adding the layers of appropriate Market Research Solutions (carried out by leading Equity Broker & Financial Service providers). We’ve also worked out a thorough process for Selection of Investment Advisory firm & their Investments strategies as well as associating with a Mutual Fund AMC & their Schemes.
We carefully evaluate various parameters to define our processses before suggesting it to any client. While streamlining any process, we adhere to the clients’ mandate and deliver the best possible outcome while staying attentive to the underlying risks. Our holistic suggestion about a wide range of financial instruments is intended to support our clients to clarify & achieve their financial goals. Tailor-made research carried out for each client contributes to building a strong & suitable portfolio for variety of clients.
Our in-built system work in 4 steps:
Identifying the need and division of work: While every individual has own reason to invest, we cannot suggest the single solution to all. As it is said, “One size hat does not fit all!” Similarly, our need identification process focuses mainly on background of investor, family/company size, the purpose and the duration of investment, and his conviction for various investment tools.
Job grouping and departmentalization: The major focus in this process is to fine-tune the investor’s need with available investment tools from the portfolio. Every department at Artham Finserve Pvt. Ltd. has well experienced and qualified professionals who are master of their domain. The departments are given the time bound job to analyze the investor’s need and how well they can serve them.
Duty assignment and execution: Our team members get involved at this step to drill down for need based solution activities. The team members from different departments are assigned the roles and responsibilities with 100% accountability based on their skills and qualifications. The internal sub process at this stage delegates the authority which establishes a strong relationship between job description and accountability.
Establishment of reporting relationship: With delegation of work, team members seek some authority as well which we make sure under the management control is assigned in this step. By assigning the authority, it creates the great environment for superior-subordinates relationship which ultimately gives best outcome. The flow of this relationship continues till our clients are getting periodic work reports. The internal and external reporting structure helps in refining the strategy for the future investment for our clients.