Wondering how to open a Citibank NRI Trading account and all the formalities associated with it? Read our guide to find out all there is to know about Citibank NRI Trading Account.
Citibank NRI Trading Account Review
Citibank is one of the biggest financial institutions in the world. It offers multiple investment options for people residing in India as well as living outside it. Citibank NRI Trading Account is one of these options.
With the Indian economy booming at a never before seen pace, it is not surprising that a huge number of Indians living outside of India are taking advantage of the market fluctuations and making profits.
Therefore, understanding the Citibank NRI Trading Account is essential to make full benefit of the major player in the market.
Citibank has affiliation from NSDL or National Securities Depository Limited as a depository partner in the stockbroking space in India. Therefore, you can trade in the same with Citibank.
Citibank NRI Demat Account
Before you open a Citibank NRI Trading Account, you will need a Demat account.
A Demat account (short for a Dematerialized account which comes from the word ‘Dematerialization‘) will hold all the cash you want to have in an electronic form. The demat account is mandatory before you open a trading account.
If you open a Demat Account with Citibank, it creates a borderless medium for transactions between Demat account and Trading account. The transfer of money becomes faster and involves less hassle.
In a repatriable Citibank NRI Trading Account, you purchase any type of equity or security using the money that is totally repatriable.
When you will be selling these shares or securities, the money that you generate will be credited to your NRE Bank account.
2. Non Repatriable Citibank NRI Trading Account:
In a non-repatriable Citibank NRI Trading Account, you purchase shares, equities, and securities using funds that are totally non-repatriable. This is either the case when you are transacting using an NRO bank account.
The other scenario is that perhaps you purchased the security or the equity when you were residing in India.
When you sell these shares or securities, the funds that are generated will only be credited to your NRO account. These cannot be repatriated outside of India without the permission of the RBI and after paying the designated taxes on the same.
Citibank NRI Trading Account Approval
Earlier, an NRI trader needed to get approval from the RBI if they wanted to trade in the Indian market. However, with new norms, the RBI delegated the requirement of approval to the respective dealers.
Therefore, Citibank as your dealer will get you all the necessary approval you need from the RBI to trade in the Indian market. You can buy and sell shares in the secondary market than in the stock market.
However, it is important to note that all the transactions in the secondary market, whether they are buying transaction or sell transaction, are to be done under the Portfolio Transaction Scheme (PIS) laid out by the RBI.
Under this scheme, you can register for secondary market transactions with one dealer only.
Citibank NRI Trading Account Documents
To open a Citibank NRI Trading Account, you will be required to submit the following documents:
A duly filled account opening form for Citibank. The form has to be signed by the holder or holders (in case there are multiple).
A cross-signed photograph of the client holding the account. In the case of multiple holders, the photograph must include all the holders and have their respective signatures.
A photocopy of the PAN card of the holder. The name of the holder on the PAN card should EXACTLY MATCH the name of the holder on the account opening form. In case the name has any differences, the form will be rejected. In the case of multiple holders, the PAN card photocopy for each holder is required.
Address proof of the account holder. For the address proof, you can submit a photocopy of the passport, driving license, utility bills, or bank statements. In the case of utility bills, only bills of the recent two months can be submitted. In the case of bank account statements, you will need to submit the statement of the last calendar quarter.
A cheque of the bank account of the linked bank. This cheque needs to be a cancelled cheque.
A photograph of the nominee along with their signature. This is needed only in case you are opting for the facility of a nominee (which I suggest you should opt for).
All these documents should be duly certified with the Indian embassy in the place you reside or a local banker. After that, they can be handed over to the NRI Service centres.
Citibank NRI Trading Account on Transfer of Status
Many people open a Citibank NRI Trading account as a resident Indian. When they become an NRI, they wonder what will happen to their account.
If the status of a person changes from Resident Indian to a non Resident Indian, they will need to close their old Citibank trading account and open a new Citibank NRI Trading account. The new account can be opened as a Non-Repatriable Citibank Demat Account.
The benefit of this is that the shares and any other securities that are present in the old account can be transferred all the same to the new account. You will have to fill a form to facilitate this transfer of shares.
Further, you will also need to submit a proof of acquisition for these shares.
Citibank NRI Trading Account Charges
When you are using a Citibank NRI Trading Account, you will also need to know the various charges that you will be levied. Here are these charges:
There are no account opening charges employed by Citibank. However, an annual maintenance fee of ₹750 is charged every year on the account if it is a non BSDA account. This fee will not be charged on the year of opening the account.
If the account is a BSDA (Basic Services Demat Account), no annual maintenance fee will be charged based on the value of holding up to ₹1,50,000. If the value of holding is more than ₹1,50,000 but less than ₹4,00,000, ₹100 will be charged.
There are charges for dematerialization of shares as well. These are charged at ₹100 for every request.
For rematerialization of shares, a base charge of ₹100 is levied. Further, a fee of ₹10 for every 100 securities is charged. Therefore, the rematerialization charges are ₹100 + ₹10 (per 100 securities). Alternatively, a flat fee of ₹50 per certificate is charged.
The higher value of the two becomes the rematerialization fee.
There are no charges for transfer in, whether it is on the market or off-market. However, a charge of transfer out is employed on off-market as well as on market. This fee is 0.06%. A minimum value of ₹49 will be charged.
There are no charges for pledge creation, pledge invocation, and pledge closure. There are also nil charges on transaction cum holding statement.
Additional charges like GST and statutory taxes are applicable on the above charges.
We hope the information provided helps you with Citibank NRI Trading Account related queries.
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If you wish to learn more about NRI Trading, here are a few references: