How to Invest in Mutual Funds from UAE| North Loop Official Blog
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30 Sep 2020

How to Invest in Mutual Funds from UAE

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If you are an NRI living in the UAE, you can invest in a host of mutual fund schemes in India as per your investment objectives. Mutual funds are market-based investment instruments that can offer high, tax-optimized inflation-beating returns and are suitable if you have long-term financial goals. It is a good investment choice for diversifying your portfolio and earning optimal returns over time. Also, you can invest in them on both repatriation and non-repatriation basis.

Another added benefit of investing in mutual funds is that you get exposure to expert-managed portfolios and your fund units get handled by professional fund managers. So, in what types of mutual funds can you invest?

Equity fund – These funds invest in equity instruments with more than 65% of the fund containing stocks (equity). The tax applicable to the sale of equity mutual funds depends on your period of holding and gets subjected to either short-term capital gains or long-term capital gains.

Debt funds – If you are risk-averse and want to avoid high-risk equity investments, debt funds are a suitable choice as these funds invest only in fixed income instruments. The tax applicable to the sale of debt funds again depends on your period of holding and gets taxed accordingly.

Hybrid funds – These funds distribute the investment corpus across different asset classes in a planned manner to mitigate risks and generate capital appreciation. If you want to create a balanced portfolio by dividing between equity and debt funds and minimize your risks, hybrid funds are a good choice. For short-term gains, hybrid funds invest in government bonds and debt instruments, and for long-term income generation, it invests in equity stock of companies.

You can invest in Indian mutual funds through your NRE or NRO account without needing any special approval from SEBI (Securities Exchange Board of India) or the RBI.

NRE account – An NRE account can get used for saving your foreign earnings in Indian currency. It allows you to repatriate your income earned abroad (UAE in this case) and helps you to carry out business, banking and investments in India.

NRO account – An NRO account allows you to manage your income earned in India such as rental, dividend or interest income. The interest earned here can get repatriated without any limits, but there is a limit of up to USD 1 million in a financial year on the principal amount.

You can open any of these accounts and then complete your KYC requirements under the norms set by the SEBI (Securities & Exchange Board of India).

KYC – This is a procedure laid down by the SEBI for financial institutions and depositories. If you want to invest in mutual funds in India, you have to become KYC compliant by fulfilling all the eligibility criteria laid by the KYC procedures.

Investing methods –

Self/Directly – You can invest in mutual funds in India directly through your NRE/NRO bank account. You can get the KYC forms on the websites of the different mutual fund companies and submit them to proceed with your investment. You can comply with the in-person verification requirements by visiting the Indian embassy in the UAE.

Power of Attorney – You can also invest by appointing a Power of Attorney on your behalf. If you do so, you must ensure that both your signatures are present on the KYC documents that get submitted.

Start investing for free with North Loop and get personalized recommendations

The best mutual funds India 2020 that you can invest in are –

3 YR   (%)   
Tata Digital India Fund   
ICICI Prudential Technology Fund   
Aditya Birla Sun Life Digital India   Fund   
PGIM India Global Agribusiness   Offshore Fund   
Franklin India Feeder – Franklin US   Opportunities Fund   
SBI Technology Opportunities Fund   
Nippon India Pharma Fund   
Kotak Gold Fund   
Axis Gold Fund   
Franklin India Technology Fund   

All the above funds namely the Tata Digital India Fund, ICICI Prudential Technology Fund, Aditya Birla Sun Life Digital India Fund, PGIM India Global Agribusiness Offshore Fund, Franklin India Feeder – Franklin US Opportunities Fund, SBI Technology Opportunities Fund, Nippon India Pharma Fund, Kotak Gold Fund, Axis Gold Fund and Franklin India Technology Fund are all growth funds and have a primary objective of long-term capital appreciation. They are among the best performing MFs India.

If you are looking to invest in the best mutual funds India 2020 from the convenience of your home, you can do so online through a digital platform like North Loop. It offers an application that eliminates the need to submit physical documents and allows paperless KYC.

Using North Loop, you can not only invest directly in mutual funds but also track the performance of your investments and use a dashboard to manage them. Moreover, it also recommends the best performing MFs India based on your financial goals or risk profile and allows you to review the different schemes’ past performance as well as calculate your SIP or returns.

Steps to follow for investing through North Loop -

Download the app from App store/Play store
Sign up on North Loop
Open an account on it
Deposit money into your account
Start investing directly in mutual funds
(You can also take the help of our professional mutual fund advisors)

To sign up with North Loop and begin investing, click here.

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This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended be advice. You must obtain professional advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax, investment or other professional advice from North Loop or its affiliates. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date. All opinions expressed do not reflect the views of North Loop nor are endorsed by North Loop.