Investment And Loans For An Nri - How Does It Work?

By Author: Kirthy Shetty
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NRIs are allowed to invest in Indian funds, shares, debentures, national savings certificate etc. Similarly, they are also permitted to borrow funds for their home, set up an industry or for their kid's education etc. Some of the authorized dealers are given the license to provide loans to NRIs. These NRI loans are provided as against a security which can be shares, debentures or any other collateral. These shares or debentures should be of an Indian company. Foreign company shares held by a non resident Indian is not taken into consideration.

You are free to create a bank account and carry out your transactions. This must be maintained in rupees and foreign currencies. Only an authorized dealer is permitted to maintain these accounts in foreign currencies. Shares and debentures from Indian companies will be accepted only if it was acquired on a repatriation basis.

There are different schemes under which non resident Indians can invest such as a:

24% scheme
40% scheme
100% scheme.

Invest in convertible debentures and remember that these should be of Indian companies. Although, you are ...
... staying abroad for various reasons you can still make investments in your home town. Apart from these, financial assistance is also available to these non resident Indians who are of Indian origin to fulfill their dreams in their home town. It could be to renovate their old house in India, construct a new one for their loved ones, investment in real estate etc.

To qualify for these financial assistance from banks:

You must have a valid passport,

You must be of 21years of age,

You should be a graduate atleast,

Your job profile will also be considered.

You are free to buy an old house or a new flat on sale with the help of Indian loans. Not all banks are allowed to deal with non resident Indian finances and other foreign currencies. Only few banks are offered the license to do so. You must approach them and they will serve you the best with their comprehensive loan packages. Loans are also offered to NRIs against NRE deposits. These loans can be repaid out of NRE funds but the interest would be charged at a commercial rate. Loans to Non-Resident Indians are also provided against FCNR deposits.

Repayment of the loan should be made within a period not exceeding 15 years out of inward remittance through banking channels or out of funds held in the investments' NRE/FCNR accounts.

Kirthy Shetty, Platinum Author.
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