Non PIS Accounts for NRIs: Basics & Benefits Explained

Your Guide to the Benefits and Features of Non-PIS Accounts. All you need to know about Non PIS Accounts for Non Resident Indians (NRIs) with FAQs
August 8, 2023
min read

Content overview:

1. What is a Non-PIS Account?

2. What is the Definition of a Non-PIS Account?

3. How Does a Non-PIS Account Work?

4. What are the Advantages of PIS?

5. Real-life Examples of Non-PIS Account Operations

6. Difference Between NRE & NRO Non-PIS Accounts 

7. Common Misconceptions & Clarifications about Non-PIS

8. Key Takeaways

9. Conclusion

10. Vance plug 

11. FAQs

In the ever-evolving banking world, understanding the nuances of specific accounts, especially for Non-Resident Indians (NRIs), can be a complex endeavor. The Non-PIS account emerges as a solution, offering NRIs an alternative to the traditional Portfolio Investment Scheme (PIS) route for stock market investments. In this blog, we will delve into the intricacies of Non-PIS accounts and their benefits for Non-Resident Indians (NRIs) interested in investing in the Indian market.

What is a Non-PIS Account?

In the financial ecosystem tailored for Non-Resident Indians (NRIs), there are numerous avenues for investments. One such term that has been gaining traction is the "Non-PIS Account." Historically, the Reserve Bank of India (RBI) introduced the Portfolio Investment Scheme (PIS) to facilitate NRIs' investment in the Indian stock market. Under the PIS, every transaction made by an NRI was meticulously monitored, ensuring that it remained within the predefined limits set by the RBI.

However, as the financial landscape evolved, so did the needs and demands of NRIs. Enter the Non-PIS account. Contrary to the PIS, the Non-PIS account provides NRIs with an avenue to invest in shares or convertible debentures of Indian companies without the shackles of the rigid PIS framework. In simpler terms, the Non-PIS account is an investment route that bypasses the need for stringent approvals from the RBI.

What is the Definition of a Non-PIS Account?

Non-PIS Account: At its core, a Non-PIS account refers to an account that allows NRIs to invest in the Indian stock market without the oversight of the Portfolio Investment Scheme (PIS) - a framework initially introduced by the Reserve Bank of India (RBI).

How Does a Non-PIS Account Work?

But why the need for a Non-PIS account? The answer lies in the flexibility it offers. The PIS came with its share of constraints, monitoring each transaction and ensuring it adhered to the limits set by RBI. The Non-PIS, on the other hand, removes these handcuffs. It operates outside this strict purview, giving NRIs a broader spectrum to invest, be it in shares or convertible debentures of Indian companies.

What are the Advantages of PIS?

1. Removal of PIS Restrictions:

Non-PIS accounts liberate NRIs from the PIS's strict investment ceilings, facilitating diversified investments.

Example: Mr. Rahul, an NRI, was previously limited by PIS caps. With a Non-PIS account, he can diversify his investments beyond these thresholds.

2. Investment Decision Flexibility:

Non-PIS accounts allow NRIs to invest in Indian company shares or convertible debentures without RBI approval, enabling swift capitalization on market opportunities.

Example: Mrs. Priya, an NRI in Canada, can invest in a high-potential tech company in India seamlessly, without regulatory delays, using her Non-PIS account.

3. Simplified Repatriation:

Non-PIS accounts streamline the process of remitting funds abroad for NRIs, bypassing the complicated guidelines of PIS.

Example: Mr. Patel, an NRI in Australia, can repatriate funds for his daughter's education easily through his Non-PIS account, avoiding PIS-related paperwork and hurdles.

4. Consolidation of Indian Income:

Non-PIS accounts aid NRIs in managing and consolidating Indian income such as rental earnings, dividends, or pensions.

Example: Ms. Neha, an NRI in the USA, channels all her Indian earnings through her Non-PIS account, simplifying income tracking and management.

Real-life Examples of Non-PIS Account Operations

Scenario A: Immediate Investment Decisions

Before: Mr. Rajan, an NRI based in the USA, identifies a promising stock in the Indian market. However, under the PIS framework, he would have to navigate a maze of regulatory approvals before he could finalize his investment. This delay might cause him to miss out on an optimal buying price.

With Non-PIS: Spotting the same stock, Rajan can now make an immediate investment decision without waiting for approvals. The stock is quickly added to his portfolio at the price he deems best.

Scenario B: Diverse Portfolio Construction

Before: Mrs. Anita, an NRI from the UK, has always been keen on diversifying her Indian portfolio. However, the PIS constraints meant she could only hold a certain amount or percentage of a particular stock, limiting her diversification options.

With Non-PIS: Anita can now expand her portfolio horizon. She isn’t bound by stringent caps on how much she can invest in one entity, allowing her to craft a more diversified and balanced portfolio.

Scenario C: Simplified Sale Proceeds

Before: On selling a particular stock, the proceeds Mr. Ishaan receives would go to his PIS account. For reinvestment, he would need to route these funds back through the PIS, which might involve additional paperwork and time.

With Non-PIS: When Ishaan sells off a part of his portfolio, the proceeds directly come to his

Non-PIS account. Reinvestment becomes a streamlined process, devoid of any cumbersome rerouting or additional documentation.

Essentially, the Non-PIS account is a symbol of financial freedom for the NRI community. By removing bureaucratic hurdles it fosters a smoother, more efficient investment journey in the heart of the Indian economic landscape.

Difference Between NRE and NRO Non-PIS Accounts

When it comes to managing finances as an NRI, two essential banking avenues often come into play: the Non-Resident External (NRE) and Non-Resident Ordinary (NRO) accounts. Let's compare NRE Non-PIS and NRO Non-PIS accounts side by side:


Common Misconceptions & Clarifications about Non-PIS

As Non-Resident Indians (NRIs) explore the realm of Non-PIS accounts, several misconceptions tend to cloud their understanding. It is essential to dispel these myths and clarify the realities of non-PIS accounts. 

Let's address some of the most common misconceptions and provide detailed clarifications:

By dispelling these common misconceptions and gaining detailed clarifications about Non-PIS accounts, NRIs can make well-informed decisions. Understanding the unique features and advantages of Non-PIS accounts empowers NRIs to optimize their financial strategies and leverage the opportunities that these accounts offer in the Indian banking ecosystem.

Key Takeaways

  • Origin of Deposits: The NRE Non-PIS account is solely for foreign income, while the NRO Non-PIS account caters to Indian and foreign income.
  • Taxability: Interest earned in the NRE Non-PIS account is tax-free in India, whereas the interest in the NRO Non-PIS account is taxable and subject to TDS.
  • Repatriation: NRE Non-PIS account allows full repatriation of the principal and interest in a foreign currency. In contrast, the NRO Non-PIS account permits repatriation up to a limit, after deducting applicable taxes.


In conclusion, Non-PIS accounts offer significant flexibility and benefits for Non-Resident Indians looking to manage their Indian income and invest in the Indian market. By understanding the distinct features and advantages of non-PIS accounts, NRIs can effectively navigate their financial journey in the Indian landscape. Whether it's the freedom from PIS restrictions, the flexibility in making investment decisions, the simplified repatriation process, or the ability to consolidate Indian income, Non-PIS accounts stand as a powerful tool in the financial arsenal of NRIs. It is crucial to dispel misconceptions and gain a clear understanding of Non-PIS accounts to make well-informed decisions and maximize the potential of these accounts. 

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FAQs about Non-PIS Accounts

Q1: What is a Non-PIS account for NRIs?

A Non-PIS account is an NRI bank account that allows NRIs to manage and hold income earned in India, such as rental earnings, dividends, or pension payments.

Q2: How is a Non-PIS account different from a PIS account?

Non-PIS accounts are meant for managing Indian income, while PIS accounts are designed for NRIs to invest in the Indian stock market.

Q3: Can I invest in Indian stocks through a Non-PIS account?

No, Non-PIS accounts are not for stock market investments. PIS accounts are used for stock market investments.

Q4: What is the repatriation limit for Non-PIS accounts?

The repatriation limit for Non-PIS accounts is USD 1 million per financial year, after considering taxes and other applicable regulations.

Q5: Is the interest earned in a Non-PIS account taxable?

Yes, the interest earned in a Non-PIS account is taxable and subject to Tax Deducted at Source (TDS).

Q6: Can I repatriate the entire balance from my Non-PIS account?

No, you can repatriate up to USD 1 million per financial year from your Non-PIS account, subject to applicable regulations.

Q7: Can I transfer funds between my Non-PIS and PIS accounts?

Yes, you can transfer funds between your Non-PIS and PIS accounts, subject to compliance with RBI guidelines.

Q8: Are Non-PIS accounts suitable for beginners in investing?

Yes, Non-PIS accounts are user-friendly and suitable for both beginners and experienced investors.

Q9: Can I hold foreign currency in a Non-PIS account?

No, Non-PIS accounts are meant to hold and manage income earned in India, and they do not support foreign currency deposits.

Q10: Is it mandatory for NRIs to have a Non-PIS account?

No, it is not mandatory for NRIs to have a Non-PIS account. They can choose to open one based on their income sources and investment preferences.

Q11: Can I use a Non-PIS account for business transactions?

No, Non-PIS accounts are meant for personal income management and cannot be used for business transactions.

Q12: Are Non-PIS accounts available in multiple currencies?

No, Non-PIS accounts are typically denominated in Indian Rupees (INR).

Q13: Can I use my Non-PIS account for receiving foreign remittances?

No, Non-PIS accounts are not suitable for receiving foreign remittances. They are for managing Indian income.

Q14: What are the benefits of using a Non-PIS account over a PIS account?

Non-PIS accounts offer more flexibility in managing Indian income and easier repatriation options compared to PIS accounts.

Q15: Do I need RBI approval to open a Non-PIS account?

No, you do not need RBI approval to open a Non-PIS account. You can open one with the assistance of a bank.

Q16:Can I open a joint Non-PIS account with a resident Indian?

No, Non-PIS accounts can only be opened by NRIs, and joint accounts with resident Indians are not allowed.

Q17: Can I invest in mutual funds through a Non-PIS account?

No, mutual fund investments are not permitted through Non-PIS accounts. PIS accounts are used for investing in mutual funds.

Q18: Is there any minimum balance requirement for Non-PIS accounts?

The minimum balance requirement for Non-PIS accounts varies from bank to bank. You need to check with your bank for specific details.

Q19: Can I repatriate my rental income through a Non-PIS account?

Yes, you can repatriate rental income earned in India through your Non-PIS account, subject to the USD 1 million repatriation limit.

Q20: Is there any difference between Non-PIS NRE and Non-PIS NRO accounts?

Yes, Non-PIS NRE accounts are for holding foreign income, while Non-PIS NRO accounts are for managing Indian income. The tax treatment and repatriation rules are different for each type.

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