Zerodha NRI PIS vs non-PIS account
The Portfolio Investment Scheme (PIS) is a channel authorised by the Reserve Bank of India under the Foreign Exchange Management Act, 1999 (FEMA) through which a non-resident Indian (NRI) or Overseas Citizen of India (OCI) cardholder buys and sells listed equity shares and convertible debentures on a recognised Indian stock exchange. At Zerodha , an NRI opens either a PIS account, which carries an RBI permission letter and routes trades through a designated partner bank, or a non-PIS account, which funds trades from an NRO bank account with any bank and needs no permission letter. The two account types differ in bank linkage, repatriation, segments allowed, reporting and brokerage.
The non-PIS route is the more recent and, for most NRIs, the more practical option. Zerodha lists it as the recommended choice because it carries fewer restrictions, lower bank-side costs, and access to segments the PIS route cannot touch. The PIS route remains relevant for one specific need: an NRI who wants secondary-market equity investments that are fully repatriable abroad through a Non-Resident External (NRE) account . This article sets out what each account can hold, how money moves and returns abroad, and what each costs.
What the Portfolio Investment Scheme is
PIS is the RBI mechanism that lets an NRI participate in the secondary market for Indian listed equity while the regulator monitors aggregate foreign holding in each company. Under the scheme, an NRI buys or sells shares through a registered broker who is a member of a recognised stock exchange, and all such trades flow through a single bank branch designated for the purpose. The designated branch reports each transaction so the RBI can track how close NRI holdings sit to the statutory ceilings.
Those ceilings are real and enforced. An individual NRI cannot hold more than 5 per cent of the paid-up capital of an Indian company, and the aggregate holding of all NRIs taken together is capped at 10 per cent of paid-up capital. That aggregate ceiling can be raised to 24 per cent if the company passes a special resolution of its general body to that effect. When total NRI holding under the scheme reaches a trigger point 2 per cent below the applicable limit, the RBI issues a caution to designated bank branches, and once the ceiling is reached, no fresh PIS purchases in that stock are allowed. A non-PIS account, which does not run under the scheme, is not subject to this per-company monitoring in the same way.
PIS also carries an old delivery rule that still applies. An NRI investing under PIS shall not engage in short selling, must take delivery of shares purchased, and must give delivery of shares sold. Shares bought on the exchange under PIS cannot later be transferred by way of a private off-market sale to a resident in India. These operational constraints originate in the RBI master circular framework on foreign investment and predate the move to the FEMA (Non-Debt Instruments) Rules, 2019, which now classify equity shares, convertible debentures and mutual fund units as non-debt instruments.
NRE and NRO bank linkage
The bank account behind the trading account is what decides repatriation, and it is the clearest practical split between the two routes.
A PIS account at Zerodha can be funded from an NRE or an NRO bank account, but the account has to be with one of Zerodha’s partner banks, because the PIS permission and the per-transaction reporting are operated by that bank. A non-PIS account supports only an NRO account , and that NRO account can be with any bank; it does not have to be on Zerodha’s partner list. A non-PIS investor can add an NRE savings account as a secondary bank account, but the trading itself runs off the NRO leg.
| Account feature | PIS | Non-PIS |
|---|---|---|
| Bank account type | NRE or NRO | NRO only |
| Bank must be a Zerodha partner | Yes | No, any bank |
| PIS permission letter from RBI | Required | Not required |
| Funds reach trading account | After bank notifies Zerodha, up to one working day | Instantly via net banking |
| Brokers mappable to one PIS permission | One at a time | Not applicable |
The “one broker, one bank” rule matters if an NRI already trades elsewhere. Only one PIS permission can be held with a single bank at any given time, and only one broker can be mapped to a PIS account. An NRI is free to change the designated branch or bank, but the bank being left must issue a no-objection certificate to the new designated branch before the permission moves.
Repatriation: where the money can go
Repatriation is the reason the PIS route exists at all, so it deserves a precise statement.
Investments made under PIS from an NRE account are fully repatriable: both the principal and the gains can be remitted abroad, subject to payment of applicable taxes. Investments funded from an NRO account, whether under PIS or non-PIS, are repatriable only within the RBI limit of USD 1 million per financial year across all NRO remittances, and that remittance needs tax clearance through the prescribed forms. Sale proceeds and dividend income earned under PIS may be credited to the NRE, FCNR or NRO account as the case may be, again subject to applicable taxes.
So the decision rule is narrow. An NRI who wants the principal and gains of secondary-market equity to leave India freely needs the NRE-PIS combination. An NRI who is content to keep funds in India, or to remit within the USD 1 million NRO ceiling, gains nothing from PIS and a good deal from non-PIS.
Segments: what each account can trade
This is where the non-PIS route has pulled clearly ahead.
A PIS account is limited to equity delivery. It cannot do equity intraday, it cannot do futures and options , and BTST (Buy Today Sell Tomorrow) is not available on it. These are regulatory and operational limits of the scheme, not Zerodha policy.
A non-PIS account is far broader. Through a single NRO non-PIS account an NRI can trade equity delivery, place equity intraday trades, do BTST, trade futures and options, invest in mutual funds , and trade commodities. The intraday, BTST and commodity access on non-PIS reflects more recent updates to the route, and they are available without any additional paperwork once the account is open.
| Segment | PIS | Non-PIS |
|---|---|---|
| Equity delivery (CNC) | Yes | Yes |
| Equity intraday (MIS) | No | Yes |
| BTST | No | Yes |
| Futures and options | No | Yes |
| Mutual funds | Not via PIS; bought directly | Yes |
| Commodities | No | Yes |
A practical note on segments and account combinations: to trade the equity segment on a repatriable basis you need the NRE-PIS account, while to trade F&O you need the NRO non-PIS account. Some NRIs therefore hold both, using NRE-PIS for repatriable equity and NRO non-PIS for derivatives and intraday.
Reporting and TDS
Reporting is a back-office cost that the two routes split between the bank and the broker.
On a PIS account, the designated bank carries the compliance load. The bank reports each transaction to the RBI for ceiling monitoring, and the bank deducts and pays the tax on capital gains: short-term capital gains on listed equity at 20 per cent under Section 111A, and long-term capital gains at 12.5 per cent on gains above Rs 1,25,000 per year under Section 112A, both at the rates set by the Finance Act 2024. Banks charge for this work, which feeds into the cost comparison below.
On a non-PIS account, Zerodha handles TDS on the account, and Zerodha states there are no additional charges for doing so. There is no RBI per-transaction ceiling reporting because the account does not run under PIS. This shift of the reporting burden from a fee-charging bank to the broker is a large part of why the non-PIS route ends up cheaper in practice.
Brokerage and other charges
Brokerage for NRI accounts at Zerodha is percentage-based with a per-order cap, and the cap is the figure that decides the cost on larger trades.
For equity delivery on a PIS account, Zerodha charges 0.5 per cent of turnover or Rs 200 per executed order, whichever is lower. For equity delivery and for F&O on a non-PIS account, the charge is 0.5 per cent or Rs 50 per executed order, whichever is lower. These rates are current as of June 2026; verify them against Zerodha’s NRI charges page before opening, since broker tariffs change.
| Charge | PIS | Non-PIS |
|---|---|---|
| Equity delivery brokerage | 0.5% or Rs 200 per order, lower of the two | 0.5% or Rs 50 per order, lower of the two |
| F&O brokerage | Not available | 0.5% or Rs 50 per order, lower of the two |
| Contract-note charge | Bank charges up to Rs 300 per contract note | No charge |
| Demat AMC | Bank charges up to Rs 1,500 per year | Rs 500 plus GST per year |
The contract-note and AMC lines are where the routes diverge most. On PIS, the bank can levy up to Rs 300 per contract note and up to Rs 1,500 a year for the demat account maintenance, because the bank runs the PIS plumbing. On non-PIS, there is no per-contract-note charge and the demat AMC is Rs 500 plus GST a year. For an active NRI investor, the per-contract-note charge on PIS alone can outweigh any benefit of the route unless full repatriation is the goal.
Statutory levies such as Securities Transaction Tax, exchange transaction charges , GST on broking , stamp duty and the SEBI turnover fee are identical for NRI and resident clients and do not vary by route, because they are fixed by law and exchange regulation rather than by residency status. DP charges on sell transactions also apply to NRI demat accounts.
Eligibility and account combinations
Both routes are open to the same set of persons: NRIs as defined under FEMA and OCI cardholders. The eligibility gate is residency status, not the route, so an applicant first establishes that the person qualifies as a non-resident and then picks PIS, non-PIS, or both.
NRIs are treated as Clients of Special Category, which is why income proof is mandatory at account opening for an NRI regardless of route, and why the account-opening flow runs offline rather than through the resident Aadhaar eKYC path. A resident who becomes an NRI does not open a fresh account from scratch in every case; an existing resident account can be converted to an NRI account, after which the bank linkage and segment access follow the PIS or non-PIS structure described above. The conversion matters because trading on a resident account after becoming a non-resident is not permitted under FEMA, so the status change has to be reflected in the account itself.
Country eligibility is a second gate specific to NRIs. Zerodha applies country-level compliance based on the Financial Action Task Force (FATF) lists: an NRI in a blacklisted country cannot open an account at all, and an NRI in a greylisted country can open one only after a compliance approval. This check sits ahead of the PIS-versus-non-PIS decision, because it can stop the application before any bank linkage or segment choice is made.
Choosing between PIS and non-PIS
The choice reduces to one question: do you need full repatriation of secondary-market equity abroad?
If yes, the NRE-PIS account is the route, and you accept the RBI permission step, the partner-bank requirement, the per-contract-note and AMC charges the bank levies, and the restriction to equity delivery only. If no, the NRO non-PIS account is lower cost, has no PIS letter to obtain, can map any bank, gives access to intraday, BTST, F&O, mutual funds and commodities, and lets Zerodha handle TDS at no extra charge. The trade-off you accept on non-PIS is the non-repatriable status of the NRO leg and the USD 1 million per financial year ceiling on NRO remittances.
Some NRIs hold both, segregating repatriable equity into NRE-PIS and everything else into NRO non-PIS. Whichever you pick, the account-opening process for NRIs at Zerodha is offline: forms are filled online, printed, and couriered, since the fully online Aadhaar eKYC flow is not available to NRI applicants. The mechanics are covered in the how to open a Zerodha NRI account guide, and the rate detail in the NRI brokerage at Zerodha article.
See also
- How to open a Zerodha NRI account
- NRI brokerage at Zerodha
- Zerodha NRI account (PIS)
- Zerodha NRI non-PIS account
- Portfolio Investment Scheme
- Non-resident Indian
- Reserve Bank of India
- Foreign Exchange Management Act
- NRE account
- NRO account
- Liberalised Remittance Scheme
- NRI mutual fund investing
- Mutual funds in India
- Zerodha
- Kite
- Zerodha brokerage structure
- Zerodha F&O charges
- Zerodha account opening charges
- Zerodha DP charges
- STT and CTT on Zerodha
- Exchange transaction charges
- GST on broking charges
- Stamp duty on stockbroker transactions
- SEBI turnover fee
- Permanent Account Number
- Demat account
- SEBI
- CDSL
- NSDL
- Aadhaar
External references
- Reserve Bank of India: Portfolio Investment Scheme
- RBI FAQs: Accounts in India by Non-residents
- Zerodha NRI account opening
- Zerodha support: difference between PIS and non-PIS
- SEBI
References
- Reserve Bank of India, Master Circular on Foreign Investment in India, Portfolio Investment Scheme provisions (RBI commonperson notification Id 1006).
- Foreign Exchange Management (Non-Debt Instruments) Rules, 2019, Schedule 2 (Portfolio Investment Scheme), Government of India.
- Reserve Bank of India FAQs, Accounts in India by Non-residents, as on 16 January 2025.
- Income Tax Act 1961, Sections 111A and 112A, as amended by the Finance Act 2024.
- Zerodha support article, “What is the difference between PIS and NON-PIS account?”, accessed 19 June 2026.
- Zerodha NRI account page, zerodha.com/open-account/nri, accessed 19 June 2026.