Are NRIs allowed to invest in NCDs?

Yes, non-resident Indians or NRIs are eligible to invest in NCDs provided that the issuer company allow NRIs to do so. NRIs can purchase NCDs either on a repatriation or a non-repatriation basis using NRE or NRO bank accounts in India.

However, not all the NCDs accept investment from NRI customers. NRI must read NCD offer documents or RHP to check their eligibility. NRI investment in NCD attracts 20% TDS.