Nithin Kamath on NRI investing: Why a 60-day onboarding process is hurting participation

Opening a bank account and investment account in India has long been one of the biggest hurdles for Non-Resident Indians (NRIs). While attractive investment opportunities such as Foreign Currency Non-Resident (FCNR) deposits and Indian equities continue to draw interest, the onboarding process has often stretched to nearly two months, discouraging many potential investors before they even get started.

Highlighting the issue, Zerodha Founder and CEO Nithin Kamath said NRI onboarding has traditionally been "a pain", adding that even compelling products fail to attract investors if account opening takes too long.

Referring to the current FCNR deposit scheme, Kamath noted that the Reserve Bank of India (RBI) is effectively bearing the currency hedging cost, allowing NRIs to earn fixed deposit-like returns while keeping their savings in US dollars without taking rupee exchange-rate risk.

"By the time the paperwork clears, the window might have closed, or the NRI may have lost interest," Kamath said in a post on LinkedIn.

Why does NRI onboarding take so long?

According to Dharmendra Maurya, Founder of Rupeeflo, the problem lies in the fragmented and largely manual onboarding ecosystem that still governs NRI investing in India.

Unlike resident investors, NRIs typically deal with multiple entities, including banks, brokers, local authorities and, in some cases, chartered accountants. Each institution follows its own documentation requirements, verification standards and processing timelines, resulting in repeated submissions and prolonged delays.

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"The core issue is that the NRI onboarding process still depends on physical documentation, manual verification and multiple handoffs, which naturally creates friction when the customer is overseas," Maurya said.

He added that there is currently no unified onboarding journey, forcing applicants to navigate different institutions with little visibility into where their applications stand.

Paperwork remains the biggest obstacle

Physical paperwork continues to be one of the largest pain points.

Many banks still require wet signatures, meaning applicants must print forms, sign them physically and courier documents to India. Depending on the country of residence, several documents also require notarisation or consular attestation before they are accepted.

Even minor discrepancies such as signature mismatches or incomplete forms can result in applications being returned, forcing applicants to restart parts of the process.

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Maurya said the absence of a single point of contact often compounds the frustration, leaving applicants uncertain about pending documentation or verification requirements.

Long delays hurt investment conversion

According to Rupeeflo, lengthy onboarding timelines directly affect investment activity.

Maurya estimates that 60-75% of potential customers drop off during onboarding, largely because the investment intent fades as the process drags on.

"Investing is driven by intent and timing—a bonus lands, a market opportunity opens up, or someone finally has the time to act. That window is short," he said.

Repeated delays caused by courier timelines, document rejections and resubmission requests often result in investors abandoning the process before funding their accounts.

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Can faster onboarding change investor behaviour?

To address these challenges, Rupeeflo, a Rainmatter-backed startup, has partnered with several banks to reduce the onboarding timeline from around 60 days to 24 hours.

The platform aims to streamline the opening of NRI bank accounts, demat accounts and trading accounts through a single digital process.

Kamath believes the experiment could provide valuable insights into investor behaviour.

"It will be interesting to watch what happens to activation rates once friction is this low," he said, adding that the key question is whether simplifying onboarding alone is enough to encourage more NRIs to invest in India.

If faster digital onboarding succeeds in improving account activation and reducing abandonment, it could mark an important shift in how Indian financial institutions serve the global Indian diaspora. With millions of NRIs looking to maintain financial links with India, reducing paperwork and shortening onboarding timelines may prove as important as offering attractive investment products themselves.