Reviewed by returnees. Cross-checked with RBI, Income Tax Department and MEA. Editorial policy.
NRIs may be interested in investing their money in RBI bonds, which are government bonds issued by the Reserve Bank of India (RBI). Fortunately, NRIs are allowed to invest in RBI bonds, subject to certain conditions. Here’s how to.
In order to invest in RBI bonds, NRIs must first obtain a “PAN” number.
This is a unique ten-digit alphanumeric code issued to all individuals by the Income Tax Department in India.
The PAN number is required to open an account with any bank in India and to make investments in securities such as RBI bonds.
Once a NRI has obtained a PAN number, they can open a Non-Resident External (NRE) or Non-Resident Ordinary (NRO) bank account in any bank in India. These accounts are designed to facilitate investment by NRIs and allow them to transfer funds from abroad into India.
NRIs can then invest in RBI bonds through their NRE or NRO account.
The bonds are available in denominations of Rs 1000, Rs 5000, Rs 10,000 and Rs 50,000. NRIs can choose to invest in either short-term or long-term bonds.
Short-term bonds have maturity periods ranging from 1 year to 3 years, while long-term bonds have maturity periods ranging from 5 years to 20 years. Interest rates on the bonds vary depending on the tenure and the amount invested.
In addition to being able to invest in RBI bonds, NRIs are also allowed to buy government securities such as treasury bills, dated government securities, and floating rate bonds.
These investments are subject to the same regulations as RBI bonds, including the requirement to open an NRE or NRO account and obtain a PAN number.
Overall, NRIs are allowed to invest in RBI bonds, provided they meet the necessary requirements. Investing in these bonds can be a great way for NRIs to save and grow their wealth while still taking advantage of the Indian financial system.
Written by
Mani Karthik
Founder, BackToIndia · Returnee since 2016
Mani Karthik is an entrepreneur who moved back to India in 2016 after nearly a decade living and working in the US and the Middle East. He started BackToIndia to help other NRIs navigate the move — banking, taxes, schooling, careers and the everyday reality of resettling in India.
Rules for NRI banking, tax and residency change often. We update guides when policy or our lived experience changes. Nothing here is legal, tax or investment advice — always confirm with a qualified professional in India.
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