SBNRI partnered with Mint, India’s most trusted financial authority, to bring clarity to millions of NRIs on wealth management, NRI banking, and taxation in India. Despite holding significant assets in India, many NRIs remain uncertain about how to invest, save, and comply with NRI tax regulations. This knowledge gap makes managing cross-border finances complex and overwhelming.
Millions of NRIs earn abroad, spend in other currencies, and plan for futures that span multiple countries. This creates important questions such as whether to invest in India or overseas, which account for NRIs is most suitable, and how to ensure they are not paying tax twice on the same income.
To provide clarity, SBNRI and Mint hosted the Mint Extraclass. The session was led by Mudit Vijayvergiya, Founder and CEO of SBNRI, along with Mint’s Jash Kriplani and Shipra Singh. It highlighted the three pillars of NRI finance, which are banking, investments, and taxation, addressed real challenges faced by NRIs, and offered practical strategies that readers can immediately use to make informed financial decisions in India.
If you missed the session, you can read the key highlights from the masterclass below to catch up on the insights.
The Financial Life of an NRI
Every NRI’s financial journey begins with income, but what truly matters is how that income is distributed. On average, NRIs earn around $150,000 per year (₹1.25 Cr). For example, a typical distribution looks like this:
- 55–60% goes into living expenses abroad such as rent, utilities, education, and lifestyle.
- 25–30% is available for savings and investments.
- 8–12% of this savings flows into India, usually through deposits or family remittances.
- 10–15% is used for discretionary goals like travel or leisure.
This balance explains why financial planning is so important. If you plan to move back to India in the next 5 years, nearly 80% of your portfolio should be India-focused. If you expect to continue living overseas, keeping about 25% in India is usually enough. This strategy prevents over-investing in India while staying prepared for global needs.
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Banking: Choosing the Right Accounts
Banking is often the first and most important decision for NRIs. The right NRI banking account determines how you can send money, earn interest, and stay compliant with tax rules.
| Account Type | Best Use | Tax Treatment in India | Repatriation |
| NRE | For income earned abroad | Interest tax-free in India, taxable abroad | Fully repatriable |
| NRO | For Indian income such as rent or dividends | Interest taxable in India | Up to $1 Mn per year with Form 15CA/CB |
| Resident | For those settled back in India | Taxable as per resident rules | Normal resident rules |
The rule is simple: use NRE for foreign income and NRO for Indian income. Mixing them can create compliance issues and increase your tax burden abroad.
Don’t have an account? Open your NRE or NRO account in just 20 seconds.
Investment Choices for NRIs
One of the most common questions NRIs ask is where to invest. The options are wide, but not every option suits every situation.
- Safe choices like NRE/NRO fixed deposits and government bonds provide stability but limited growth.
- Mutual funds are a practical choice for most NRIs. They require no Demat account, are easy to monitor, and offer diversified growth.
- Stocks demand time and attention. They can deliver high returns but require active monitoring.
- Portfolio Management Services (PMS) and Alternative Investment Funds (AIFs) are ideal for larger portfolios and higher risk tolerance.
- Real estate remains attractive, especially for retirement and rental income, but management can be a challenge for those living abroad.
Additionally, a newer option for NRIs is GIFT City, India’s international financial hub. Here, NRIs can hold accounts in USD, GBP, EURO, or JPY, which helps protect against rupee depreciation. It also offers tax benefits and makes repatriation easier. For globally mobile NRIs, GIFT City acts as a bridge between Indian and international markets, making cross-border finance simpler and more efficient.
Taxation and DTAA: The Need for Clarity
Taxation is one of the most challenging areas for NRIs. Income earned in India, such as interest on deposits, rental earnings, or capital gains from investments, is subject to Indian taxes. Meanwhile, income earned abroad is generally taxed in your country of residence. This overlap can create the risk of paying tax twice on the same income.
The Double Taxation Avoidance Agreement (DTAA) was designed to solve this problem. It allows NRIs to either avoid paying tax in one of the two countries or claim credit for the tax already paid in India. The benefit you receive depends on the specific agreement between India and your country of residence.
Consider two examples:
- An NRI living in Singapore who earns ₹50 lakh from Indian mutual fund gains does not pay tax in India because of DTAA. Singapore also exempts these gains, which means there is no tax liability at all.
- An NRI living in the UK who earns rental income in India pays tax in India first. Under DTAA, the tax already paid can be claimed as a credit in the UK, so the same income is not taxed twice.
The key message is that understanding the DTAA provisions of your country can save substantial amounts of money each year. Many NRIs lose this advantage simply because they are not aware of the rules or do not apply them correctly when filing their returns.
Read more about DTAA and maximize your NRI tax benefits.
Why India Remains a Key Investment Destination
Most NRIs continue to invest in India. The reasons are both practical and emotional:
- Retirement planning in a country with lower living and healthcare costs.
- Purchasing property for security or rental income.
- Building a backup fund for children’s education.
- Maintaining lifestyle continuity with long-term expenses planned in rupees.
India’s growth story makes this even more compelling. After overtaking the UK in 2023 to become the 5th largest economy, India is projected to surpass Germany by 2025, becoming the 4th largest in the world. For NRIs, this economic trajectory strengthens the case for continued investment in India.
Case Study: Structured Planning in Action
Consider the case of Mr. Shivansh, a 35-year-old NRI based in Dubai. His financial profile is typical of many professionals working abroad:
- Assets: Real estate worth ₹2–3 Cr, deposits of ₹75 lakh, retirement funds abroad worth ₹1–2 Cr.
- Liabilities: A home loan of ₹40 lakh and annual family support of ₹3 lakh.
With a clear plan that balances NRE and NRO accounts, allocates investments across mutual funds and property, and leverages DTAA benefits, his current net worth of ₹3.1 Cr can grow to ₹12 Cr in 10 years at 10% CAGR. This case shows how thoughtful financial structuring can turn complexity into opportunity.
At SBNRI, we have built the first fintech platform created exclusively for NRIs. Our app combines everything you need in one place, including investments, taxation, NRE and NRO banking, and compliance. With trusted partnerships across banks, investment platforms and tax experts, we make it easier for more than 30 million NRIs worldwide to manage their money with confidence.
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Among the many options available, mutual funds are one of the most effective ways for NRIs to grow wealth. They are simple to start, require no Demat account, and provide strong long-term growth potential. Through SBNRI, you can explore carefully selected mutual funds that match your goals and risk profile.
Take control of your global finances with SBNRI.
