Reg: NRE Trading

#1
Hi All,

I have been working outside India since an year.
I have a trading account with one of hte stock broking firms.
I have an NRE account with HDFC Bank.
and a domestic account with ABN AMRO bank.

In order to make the payments to the stock broking firm, can i issue cheque from domestic account of ABN AMRO bank? Will that payment be accepted?

what if it is not possible for me to issue a cheque from NRE account with HDFC Bank?

what are the pros and cons in both the cases?

Kindly help me out.

Thanks n Regards,
 
#3
DEAR MADAM
YOU HAVENT MENTIONED WHICH TYPE OF ACCOUNT YOU ARE HAVING FOR TRADING. IT LOOKS AS YOU HAVE OPENED THE ACCOUNT IN INDIA ONE YEAR BEFORE I HOPE IT IS RESIDENT ACCOUNT FOR WHICH YOU CAN STILL OPERATE THIS ACCOUNT FROM ANY OF YOUR BANK ACCOUNTS. THE SHARES WILL BE AS RESIDENT STATUS ONLY.IF YOUR ACCOUNT IS NRE TRADING ACCOUNT THEN PIMS AND NON FIMS some thing like this question will come. being an nri check with your bank the posibilities and act.
ravi
 

TFL

Well-Known Member
#4
Your question misses many details to answer, there are two cases.

Case 1: Your Demat/Trading account is opened through PIS.
You cannot give a cheque from your NRE/NRO/SB accounts for crediting to trading account as all the funds should be routed through PIS account. For that you should fund your PIS (a type of bank account) first.

Case 2: Your Demat/Trading account is a normal account like a normal residential.
You can give a cheque from your NRE/NRO/SB accounts for crediting to trading account.

If you need more details of the PIS elaborate your question.

Haribird.
 
#5
Dear Ravi/Hari,

I have opened the trading a/c 2 years ago while I was still residing in India.
As per your replies, i understand that I can issue a cheque from NRE/NRO/SB accounts for crediting to this trading account.

Is my understanding correct?
If yes, what are its effects? I mean to ask is an NRI eligible to do so? Or are there any rules that an NRI needs to operate thro' PIS ?

And even more, I tried googling for such information but got lost :mad:
Can u give me a link so that a beginner like me can actually understand the basics of NRI trading?

Thanks a bunch,
Sandhya
 

TFL

Well-Known Member
#6
Dear Ravi/Hari,

I have opened the trading a/c 2 years ago while I was still residing in India.
As per your replies, i understand that I can issue a cheque from NRE/NRO/SB accounts for crediting to this trading account.

Is my understanding correct?
If yes, what are its effects? I mean to ask is an NRI eligible to do so? Or are there any rules that an NRI needs to operate thro' PIS ?

And even more, I tried googling for such information but got lost :mad:
Can u give me a link so that a beginner like me can actually understand the basics of NRI trading?

Thanks a bunch,
Sandhya
Sandhya,

Its illegal for an NRI to trade in indian market without taking RBI Permission(under PIS) and you should route the money through PINS(PIS) Account.

Haribird.
 

karthikmarar

Well-Known Member
#8
It is even illegal for an NRI has a rupee account. He / She is supposed to have an NRO (Non Resident Ordinary) account for local rupee payments and rupee incomes like dividends etc. Some like ICICI Direct provide 3 in 1 trading account for NRIs. (Trading, Demat and bank Account).
 

TFL

Well-Known Member
#9
It is even illegal for an NRI has a rupee account. He / She is supposed to have an NRO (Non Resident Ordinary) account for local rupee payments and rupee incomes like dividends etc. Some like ICICI Direct provide 3 in 1 trading account for NRIs. (Trading, Demat and bank Account).
Almost all brokers are providing such kind of packages for NRI's.
ICICIDirect, Geojit, Sharekhan, etc.

haribird.
 
#10
One thing to be careful of when investing in the stock market from overseas is the time difference. It can get a bit of a hard work if you are in the US or Canada. You may find it easier to invest in managed funds. Have you considered that option?
 

Similar threads