SEBI NRI onboarding reform may unlock more foreign capital for Indian markets, says Nithin Kamath
SEBI has proposed allowing NRIs, OCIs and foreign nationals from FATF-compliant countries to complete digital KYC remotely for investing in India’s securities market. Zerodha founder Nithin Kamath said the move could remove a major onboarding hurdle and help attract more overseas capital to Indian markets.
- Aug 18, 2026,
- Updated Aug 18, 2026 7:25 PM IST
SEBI’s proposal to enable fully digital onboarding for non-resident Indians (NRIs) could make it significantly easier for overseas Indians to invest in Indian markets, potentially widening a durable source of foreign capital. Zerodha founder Nithin Kamath said the proposed changes could remove one of the biggest remaining hurdles for NRIs seeking to invest in India.
In a post on X, Kamath said the Securities and Exchange Board of India’s consultation paper proposes allowing NRIs to complete e-signing requirements from their country of residence, eliminating the need to be physically present in India for account opening.
NRI capital could support Indian markets
Kamath said NRIs tend to represent an important pool of capital because they often invest larger amounts and have a longer-term investment horizon.
“At Zerodha, we have over 50,000 NRIs investing with us today,” Kamath said. He added that around 80% of these investors are active, a figure he described as surprising.
According to Kamath, NRI investors also appear to be “much stickier” than regular investors, suggesting that simplifying access could encourage sustained participation rather than short-term flows.
For Indian equities, a larger NRI investor base could provide an additional source of domestic market demand. Unlike foreign institutional investors whose allocations can change sharply in response to global interest rates, currency movements and risk sentiment, individual NRI investors may have different investment objectives and longer holding periods.
MUST READ: NRIs, OCIs can complete SEBI KYC from abroad: What changes under new proposal?
Physical onboarding remains a hurdle
Kamath said the process of investing as an NRI has already become considerably easier following earlier regulatory changes.
NRIs can generally invest through NRO Non-PIS accounts without the earlier requirement of setting up the entire Portfolio Investment Scheme (PIS) arrangement. Kamath said these accounts now offer access to several market segments, including intraday trading, BTST and futures and options, subject to applicable rules.
However, he identified account onboarding as the remaining major obstacle.
“Even today, to open an account digitally, an NRI has to be physically in India,” Kamath said, adding that overseas applicants otherwise face extensive physical documentation and international courier delays.
Faster onboarding could expand the investor base
The proposed framework could allow documents to be digitally signed from an investor’s country of residence. Kamath said this could substantially reduce the time required to open an account.
A process that can currently take two to three weeks or even months, according to him, could potentially be completed within one to two days if the proposed changes are implemented.
Kamath believes removing this friction could expand the NRI investor base several times over.
MUST READ: Regular vs direct mutual funds: 34% of regular SIP assets held 5+ years as compared to 20% direct
Why foreign inflows matter
For India, greater NRI participation could mean a broader pool of foreign capital entering domestic financial markets. Increased inflows into Indian assets can support demand for equities and other securities, while foreign currency entering the country can also contribute to the supply of dollars in the domestic foreign-exchange market.
Kamath said making it easier for overseas Indians to invest in India “helps the rupee and the larger India story.”
However, the impact on the rupee would depend on the scale and consistency of such inflows relative to India's overall balance of payments and other foreign currency flows.
SEBI’s proposal is currently at the consultation stage. If finalised, the digital onboarding framework could mark another step towards reducing regulatory and operational friction for NRIs investing in Indian markets.
ALSO READ: SEBI proposes ₹5 crore asset test for accredited investors: Who could qualify?
SEBI’s proposal to enable fully digital onboarding for non-resident Indians (NRIs) could make it significantly easier for overseas Indians to invest in Indian markets, potentially widening a durable source of foreign capital. Zerodha founder Nithin Kamath said the proposed changes could remove one of the biggest remaining hurdles for NRIs seeking to invest in India.
In a post on X, Kamath said the Securities and Exchange Board of India’s consultation paper proposes allowing NRIs to complete e-signing requirements from their country of residence, eliminating the need to be physically present in India for account opening.
NRI capital could support Indian markets
Kamath said NRIs tend to represent an important pool of capital because they often invest larger amounts and have a longer-term investment horizon.
“At Zerodha, we have over 50,000 NRIs investing with us today,” Kamath said. He added that around 80% of these investors are active, a figure he described as surprising.
According to Kamath, NRI investors also appear to be “much stickier” than regular investors, suggesting that simplifying access could encourage sustained participation rather than short-term flows.
For Indian equities, a larger NRI investor base could provide an additional source of domestic market demand. Unlike foreign institutional investors whose allocations can change sharply in response to global interest rates, currency movements and risk sentiment, individual NRI investors may have different investment objectives and longer holding periods.
MUST READ: NRIs, OCIs can complete SEBI KYC from abroad: What changes under new proposal?
Physical onboarding remains a hurdle
Kamath said the process of investing as an NRI has already become considerably easier following earlier regulatory changes.
NRIs can generally invest through NRO Non-PIS accounts without the earlier requirement of setting up the entire Portfolio Investment Scheme (PIS) arrangement. Kamath said these accounts now offer access to several market segments, including intraday trading, BTST and futures and options, subject to applicable rules.
However, he identified account onboarding as the remaining major obstacle.
“Even today, to open an account digitally, an NRI has to be physically in India,” Kamath said, adding that overseas applicants otherwise face extensive physical documentation and international courier delays.
Faster onboarding could expand the investor base
The proposed framework could allow documents to be digitally signed from an investor’s country of residence. Kamath said this could substantially reduce the time required to open an account.
A process that can currently take two to three weeks or even months, according to him, could potentially be completed within one to two days if the proposed changes are implemented.
Kamath believes removing this friction could expand the NRI investor base several times over.
MUST READ: Regular vs direct mutual funds: 34% of regular SIP assets held 5+ years as compared to 20% direct
Why foreign inflows matter
For India, greater NRI participation could mean a broader pool of foreign capital entering domestic financial markets. Increased inflows into Indian assets can support demand for equities and other securities, while foreign currency entering the country can also contribute to the supply of dollars in the domestic foreign-exchange market.
Kamath said making it easier for overseas Indians to invest in India “helps the rupee and the larger India story.”
However, the impact on the rupee would depend on the scale and consistency of such inflows relative to India's overall balance of payments and other foreign currency flows.
SEBI’s proposal is currently at the consultation stage. If finalised, the digital onboarding framework could mark another step towards reducing regulatory and operational friction for NRIs investing in Indian markets.
ALSO READ: SEBI proposes ₹5 crore asset test for accredited investors: Who could qualify?