How NRIs from US & Canada and from many other countries are Using ULIPs to Bypass
Mutual Fund Restrictions — Legally and Smartly
India’s financial markets are booming. For
investors globally — especially Non-Resident Indians (NRIs) — India represents
a dynamic opportunity to grow wealth.
But for NRIs living in the United States and Canada, this journey is often
blocked at the first step:
❌ Mutual Funds
❌ Digital KYC
❌ Easy access to Indian equities
❌ 18% GST exemption on premium
Why? Because of FATCA and CRS compliance hurdles, most Indian AMCs restrict or
outright reject investments from these countries.
But what if we told you HNIs have already found a smarter, compliant, and
tax-efficient solution?
✅ ULIPs (Unit Linked Insurance Plans) — no longer just insurance, but a
strategic investment wrapper.
Why Mutual Funds Are a Dead End for US/Canada NRIs
Due to FATCA (Foreign Account Tax
Compliance Act – USA) and CRS (Common Reporting Standard – global), Indian
mutual fund houses are reluctant to onboard NRIs from the US and Canada and from
many other countries.
Most AMCs Do Not Allow Investments from
US/Canada NRIs:
- HDFC Mutual Fund
- Kotak Mutual Fund
- Axis MF
- Franklin Templeton
- Mirae Asset
- Quant MF
- Nippon India MF
- Motilal Oswal
- DSP MF
- Canara Robeco
A Few AMCs That Do Accept — With Strings
Attached:
PPFAS (Parag Parikh): US & Canada NRIs
– Offline – Best among few
SBI MF: US & Canada NRIs – Offline only – Tedious paperwork
ICICI Pru MF: US NRIs – Offline – Limited schemes
UTI MF: US & Canada NRIs – Online – NSDL + NRI KYC needed
The ULIP Advantage: Compliant, Tax-Free, Market-Linked
ULIPs, regulated by IRDAI, are issued by
life insurance companies — not mutual fund houses. These insurers have robust
systems to handle FATCA/CRS compliance.
Why ULIPs Work Brilliantly for HNIs &
NRIs:
FATCA/CRS Compliant: Mutual Funds – No |
ULIPs – Yes
Online Access: Mutual Funds – Limited | ULIPs – Available
Equity/Debt Exposure: Both – Yes
Tax-Free Maturity: Mutual Funds – LTCG applies | ULIPs – Yes (Sec 10(10D))
Fund Switching: Mutual Funds – Taxable | ULIPs – Unlimited, tax-free
Life Cover: Mutual Funds – No | ULIPs – Yes
Wealth Planning: Mutual Funds – Partial | ULIPs – Comprehensive
Real Strategy: Why HNIs Are Choosing ULIPs — Not Just
Settling for Them
Contrary to old perception, ULIPs today are
not seen as a compromise — but a conscious portfolio choice among HNIs.
Here's why:
- Privacy + Control: Investment growth + life cover in one clean wrapper
- Tax-free returns under 10(10D)
- Long-term equity exposure via large-cap, mid-cap, and hybrid funds
- Switch flexibility during market corrections — tax-free
- FATCA/CRS compliant onboarding for global investors
An HNI client of ours — a US-based
entrepreneur— reallocated ₹50L from non-compliant mutual fund plans into a
ULIP from a leading Indian insurer. Today, he enjoys:
- Indian market exposure
- Tax-exempt maturity
- Policy dashboard access from anywhere
- Life cover as a bonus layer of protection
This isn’t fallback investing — this is portfolio engineering.
Final Word: ULIPs Are the New-Age NRI Gateway to Indian
Markets
ULIPs have evolved from high-cost, opaque
products to transparent, low-charge, performance-driven platforms.
For US/Canada NRIs, they offer:
✅ Legal access to Indian markets
✅ Tax-free investing
✅ Risk-managed fund switching
✅ Peace of mind through regulatory compliance
When mutual funds say “No”, ULIPs say “Here’s a better way.”
Ready to Build Your India-Focused Portfolio, the Smart
Way?
Whether you're a global HNI or an NRI
professional, we can help you build a custom ULIP strategy that’s:
- FATCA-compliant
- Long-term growth focused
- Tax efficient
- Digitally accessible
Let’s structure your portfolio — the NRI-HNI way.
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