Just like the bank accounts in India, NRIs can have two types of Demat account for
investment purpose - NRE & NRO.
NRE DEMAT A/C (INVESTMENT ON REPATRIATION BASIS):
The repatriation of the sale proceeds is allowed if the original purchase was made
on repatriation basis. Means you can take your capital, profits, and dividends in
foreign exchange, which you invested originally in foreign exchange.
NRO DEMAT A/C (INVESTMENT ON NON REPATRIATION BASIS):
Through this account one cannot repatriate their investment/capital in foreign exchange.
Means you can get back the proceeds only in Indian rupees, irrespective of the currency
you used to invest in the same. Upon becoming an NRI, the balances held in resident
account should be transferred to the NRO account and securities held under this
account will be treated on non-repatriable basis.
However, repatriation is allowed under the LRS (Liberalized Remittance Scheme) of
RBI. There are limits to how much funds one can repatriate in a given year. The
latest details and amount allowed for repatriation are available on RBI website:
Advantages of Demat account:
DEMATERIALIZATION OF SHARE CERTIFICATES:
- Dematerialization of Physical Shares/Certificates
- Online statement holding facility
- Automatic dividend credit to your bank A/C
- Nomination facility
- Change of address/ Bank flexibility
- Freezing & De-freezing of A/C
Shares listed on Indian stock exchanges have to be purchased / sold in Dematerialized
(Demat) form only. There are many cases where old physical share certificates are
still not dematerialized. The process for this conversion is lengthy as the companies
need to ensure that the real owners of the shares are the ones dematerializing it.
We, at Shah Investor’s Home Ltd, have dedicated highly qualified and experienced
team to guide our customers through this process and convert the shares to demat
form. Please get in touch with us if you have any physical share certificates that
need to be converted to demat form.