NRIs — A Lucrative Market for Wealth Managers
Non-Resident Indians (NRIs) hold immense potential for wealth management firms in India. Their substantial investments (averaging 2–4 times larger than resident Indians) and long-term relationships make them valuable clients. However, the pandemic caused a slight dip in their share of domestic investments.
India’s Growth Story Beckons NRIs
India’s booming economy (projected GDP growth of 6.8% in 2024 and 6.5% in 2025) and large consumer base present enticing investment opportunities. Stable currency, robust financial institutions, and investor-friendly regulations further solidify India’s appeal. Additionally, attractive returns, tax benefits, and easy repatriation options make it an attractive investment destination for NRIs.
Finding the Right Wealth Manager is Key
Choosing the right wealth manager is crucial for NRIs to achieve optimal returns and financial security. Here are seven key factors to consider:
1. Comprehensive Product and Service Offerings:
Seek wealth managers with a deep understanding of NRI needs, offering diverse options like Portfolio Management Services (PMS), Alternative Investment Funds (AIFs), Mutual Funds, real estate advisory, estate planning, and tax support. Transparency, credibility, and a client-centric approach are vital.
2. Proper Licensing:
Ensure your chosen wealth manager holds the necessary licenses:
Mutual Fund Distributors license (ARN code) with NISM Series V-A certification
PMS Distributors license with NISM Series XXI-A certification
AIF Distributors license with NISM Series XIX-A certification
Registered Investment Advisor (RIA) license
Insurance Regulatory and Development Authority of India (IRDAI) license (if offering insurance products)
3. Knowledgeable and Dedicated Relationship Managers (RMs):
Opt for wealth managers with RMs specializing in NRI needs. They should possess in-depth knowledge of NRI-specific regulations such as:
Portfolio Investment Scheme (PIS)
NRO vs. NRE bank accounts
NRI taxation on capital gains vs. dividends
Double Taxation Avoidance Agreement (DTAA)
Foreign Currency Non-Resident (FCNR) deposits
Tax Deducted at Source (TDS) rates applicable to NRIs
Repatriation rules and limits
4. Dedicated NRI Service Desks:
Prioritize wealth managers with dedicated NRI service desks or call centres staffed with experts in handling NRI client needs. Ensure operating hours align with your time zone for easy communication.
5. Physical Presence in NRI Hubs:
Consider wealth managers with offices in regions with high NRI populations (e.g., Singapore, Hong Kong, UAE). This provides convenient support both in India and abroad.
6. Advanced Digital Infrastructure:
If a physical presence isn’t available, prioritize wealth managers with robust digital platforms offering risk profiling, e-KYC, online onboarding, investment proposals, execution support, and detailed reporting for a seamless experience.
7. Informative Webinars and Seminars:
Look for wealth managers who actively organize educational sessions with external experts to keep NRIs informed about regulatory changes and investment opportunities. This is invaluable in a dynamic financial environment.
By considering these factors, NRIs can confidently navigate India’s wealth management landscape and unlock its full potential for their financial goals.