SEBI’s proposal to allow fully digital onboarding for non-resident Indians could dramatically reduce the time required to open investment accounts in India, potentially bringing the process down to one or two days from the weeks or even months it can take today. Zerodha co-founder and CEO Nithin Kamath has welcomed the proposal, calling it a major step toward removing one of the biggest barriers faced by overseas Indian investors.
The Securities and Exchange Board of India issued its consultation paper on August 14, 2026, proposing changes to the Know Your Client process for NRIs, Overseas Citizens of India and foreign nationals residing outside India. The proposal would allow eligible investors to complete key onboarding requirements digitally from their country of residence, potentially eliminating the need to travel to India simply to open an investment account.
SEBI Proposes Fully Digital NRI Onboarding
The proposed changes are aimed at simplifying the KYC and account-opening process for individual investors residing outside India.
Under the current process, NRIs can face extensive documentation requirements, physical verification and courier-related delays. Kamath said that even when an NRI wants to open an account digitally, the existing process can require the investor to be physically present in India. For those living abroad, the alternative involves paperwork and international courier services.
SEBI’s consultation paper seeks public comments on changes to the KYC framework for NRIs, OCIs and foreign nationals living abroad. The regulator’s stated objective is to make the onboarding process more seamless while maintaining the necessary KYC and regulatory safeguards.
NRI Onboarding Proposal At A Glance
| Metric | Details |
|---|---|
| Regulator | SEBI |
| Consultation paper issued | August 14, 2026 |
| Target investors | NRIs, OCIs and foreign nationals abroad |
| Current difficulty | Physical presence and extensive documentation |
| Potential account-opening time | 1-2 days |
| Current timeline cited by Kamath | 2-3 weeks or even months |
| Key proposed change | Digital onboarding from country of residence |
| Zerodha NRI investors | 50,000+ |
| Active Zerodha NRI investors | ~80% |
The one-to-two-day timeline is an estimate highlighted by Kamath if the proposed changes are finalized and implemented effectively. It is not a timeline guaranteed by SEBI.
Account Opening Could Fall From Weeks To Days
The biggest potential benefit of the proposal is speed.
Kamath said that a process which can currently take two to three weeks, or sometimes months, could potentially be completed in one or two days under the proposed framework. He attributed the existing delays largely to documentation and physical verification requirements.
Potential Timeline Change
CURRENT PROCESS
2-3 weeks
████████████████████████
Sometimes months
████████████████████████████████████████
↓ SEBI DIGITAL PROPOSAL
1-2 days
██
The difference could be particularly significant for NRIs who live thousands of kilometres away from India. A requirement to visit India, complete physical documentation or send notarised documents through international courier services can add both time and cost.
A fully digital process could remove several of these friction points.
E-Signatures Could Remove A Major Bottleneck
One of the key proposals highlighted by Kamath is allowing investors to provide e-signatures directly from their country of residence.
This could eliminate the need for an NRI to travel to India simply to complete certain account-opening formalities. It could also reduce dependence on physical document delivery and manual processing.
How The Proposed Digital Process Could Work
NRI Living Abroad
│
▼
Digital KYC Application
│
▼
Identity / KYC Verification
│
▼
E-Signature In Country Of Residence
│
▼
Broker / Intermediary Verification
│
▼
Investment Account
│
▼
Potentially 1-2 Days
The precise operational process will depend on the final rules and implementation framework after SEBI considers public feedback.
Why NRI Investors Matter To Indian Markets
Kamath argues that NRIs represent an attractive investor base for Indian capital markets.
According to Kamath, Zerodha has more than 50,000 NRI investors, with around 80% actively investing. He said NRIs tend to invest larger amounts, take a longer-term view and remain invested for longer than regular investors.
Zerodha’s NRI Investor Base
| Measure | Figure |
|---|---|
| NRI investors | 50,000+ |
| Actively investing | ~80% |
| Estimated active investors* | 40,000+ |
| Estimated inactive investors* | 10,000+ |
*Approximate calculation based on Kamath’s reported figures; Zerodha’s reported total is “more than 50,000,” so the actual numbers could be higher.
If 80% of a 50,000-person base is used as a simple reference point, more than 40,000 investors would be active.
NRI Investment Could Become Easier
The potential impact goes beyond opening a brokerage account.
Once onboarding becomes simpler, NRIs could find it easier to participate in India’s equity markets, mutual funds and other permitted securities-market products, subject to applicable rules.
The reduction in administrative friction could also make Indian financial platforms more attractive to overseas Indians who currently avoid investing because of the complexity involved.
Current Friction Vs Proposed System
| Area | Current Experience | Proposed Direction |
|---|---|---|
| Physical presence | Can be required | Reduced / removed |
| Documentation | Extensive physical paperwork | Greater digital processing |
| Signature | Physical processes can apply | E-signature from residence |
| Courier | International courier may be needed | Reduced dependence |
| Processing time | Weeks or months in some cases | Potentially 1-2 days |
| Investor access | More complicated | More seamless |
The proposal is therefore less about creating a new investment product and more about removing administrative barriers around existing investment access.
SEBI’s Proposal Covers More Than NRIs
The consultation paper is titled “Review of Know Your Client Process for Individual Persons Resident Outside India” and covers individual NRIs, OCIs and foreign nationals residing outside India.
That broader scope is significant because the proposed framework could make India’s securities market easier to access for a wider group of individuals living abroad.
Reuters reported that SEBI’s proposal would allow individual foreign investors to complete regulatory onboarding digitally, potentially increasing participation in India’s securities markets by reducing procedural barriers.
NRI Investment Has Already Seen Regulatory Simplification
Kamath also pointed to earlier regulatory changes that made it easier for NRIs to participate in Indian markets.
He said many NRIs now enter through NRO Non-PIS accounts rather than the traditional Portfolio Investment Scheme route for several investments. According to Kamath, these accounts can provide access to facilities such as intraday trading, BTST and futures and options without requiring a CP code, subject to the applicable regulatory framework.
This means the proposed KYC changes could represent another stage in a longer process of simplifying NRI participation.
Evolution Of NRI Market Access
Traditional NRI Framework
│
▼
PIS-Based Investment
│
▼
Regulatory Simplifications
│
▼
NRO Non-PIS Route
│
▼
More Digital Services
│
▼
SEBI Digital KYC Proposal
│
▼
Potential Fully Digital Onboarding
The broader objective is to reduce administrative complexity while retaining regulatory oversight.
Why Physical Verification Has Been A Problem
For resident Indian investors, digital onboarding has become relatively routine. For NRIs, however, cross-border KYC creates additional complications.
Documents may need to be verified across jurisdictions, signatures may need certification, and physical documents can take time to travel between countries.
International courier delays can become particularly frustrating when an application is rejected and documents have to be resubmitted.
Kamath described this as one of the most painful parts of the NRI investment journey.
Major NRI Onboarding Barriers
| Barrier | Impact |
|---|---|
| Physical presence | May require travel to India |
| Paper documentation | More manual processing |
| International courier | Adds time and cost |
| Document verification | Can delay activation |
| Re-submission | Further extends timelines |
| Cross-border KYC | More complicated than resident onboarding |
SEBI’s proposal attempts to address these bottlenecks through digital processes.
More NRI Capital Could Flow Into India
If the onboarding process becomes substantially easier, the potential impact could extend beyond individual brokers.
Indian equities and other securities could become more accessible to the large overseas Indian population. A lower administrative barrier could encourage existing NRI investors to increase their activity while also attracting people who have previously avoided Indian investments because of onboarding complexity.
Kamath argued that removing this friction could make the NRI investor base “many times larger.”
That is a projection rather than a formal SEBI estimate, but it illustrates the potential scale of the opportunity perceived by market participants.
Digital Onboarding Still Needs Strong KYC Controls
Making onboarding faster does not mean eliminating regulatory checks.
SEBI’s challenge will be to create a system that is both convenient and secure. Cross-border investors still need to be identified, verified and screened in accordance with applicable KYC and anti-money-laundering requirements.
The final framework will therefore need to balance speed with investor protection.
DIGITAL ONBOARDING
│
┌──────────┴──────────┐
▼ ▼
SPEED SAFETY
│ │
Faster account KYC verification
opening AML compliance
│ │
└──────────┬──────────┘
▼
Easier NRI Access
The consultation process gives SEBI an opportunity to refine the proposed framework before implementation.
What The Proposal Could Mean For Brokers
Indian brokers could also benefit from a simplified NRI onboarding process.
Today, intermediaries have to manage additional paperwork, verification and cross-border documentation for overseas clients. A standardized digital process could reduce manual work and potentially lower the cost of servicing NRI accounts.
It could also allow brokers to compete more aggressively for overseas Indian investors.
Potential Benefits For Market Participants
| Stakeholder | Potential Benefit |
|---|---|
| NRIs | Faster and simpler onboarding |
| Brokers | Lower manual processing burden |
| Banks | Easier account-linked investment processes |
| Exchanges | Potentially larger investor base |
| Indian markets | More potential capital inflows |
| Regulators | More standardized digital KYC |
The actual benefits will depend on how the final framework is implemented.
SEBI Is Seeking Public Feedback
The August 14 consultation paper is currently a proposal rather than a final rule. SEBI has invited public comments as part of the consultation process.
This means the exact requirements, implementation timeline and operational procedures could change before the framework becomes final.
For investors and intermediaries, the next important step will therefore be the regulator’s response to stakeholder feedback and any subsequent circular or regulatory amendment.
The Bigger Picture
SEBI’s proposed digital NRI onboarding framework could remove one of the most persistent administrative barriers preventing overseas Indians from investing more easily in India’s securities markets. The potential reduction from weeks or months to one or two days, as highlighted by Nithin Kamath, would represent a significant improvement for investors who currently face physical documentation, courier delays and possible travel requirements.
The proposal also fits into a broader effort to make India’s capital markets more accessible through digital infrastructure. With Zerodha alone reporting more than 50,000 NRI investors and around 80% of them actively investing, even a modest expansion in participation could create a meaningful additional pool of overseas capital for Indian markets.
Looking Ahead
The immediate focus will be on SEBI’s consultation process and the final version of the KYC framework. The regulator will need to determine how digital signatures, identity verification and other requirements can be completed remotely while maintaining robust compliance standards. The final rules will also determine whether the one-to-two-day onboarding expectation becomes achievable in practice.
If implemented effectively, the changes could make India significantly more accessible to overseas individual investors. For NRIs, the biggest benefit would be convenience; for brokers and market infrastructure providers, it could mean a larger addressable customer base. For Indian capital markets, the long-term opportunity is to attract more stable overseas participation by removing procedural friction without compromising regulatory safeguards.
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