SEBI has issued a consultation paper to review and simplify the Know Your Client process for individual Persons Resident Outside India (PROI), comprising NRIs, OCIs and foreign nationals located outside India, to enable seamless digital on-boarding in the securities market. Under the existing process, digital on-boarding of non-resident clients requires the client’s location to be in India, limiting digital KYC while outside India. SEBI has received stakeholder representations seeking relaxation regarding presence in India, verification of original Officially Valid Documents, signature affixation and portability of KYC records. SEBI proposes reviewing the on-boarding process to enable complete digital on-boarding of PROI clients while outside India, including the use of electronic/digital signatures, DigiLocker or digital Aadhaar authentication and video-based In Person Verification. The review follows SEBI’s December 10, 2025 circular relaxing geo-tagging requirements for NRIs undertaking re-KYC and the Union Budget FY2026-2027 and June 12, 2026 amendment to the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 concerning investments by individual PROIs and foreign nationals.
Securities and Exchange Board of India
Consultation paper
Review of Know Your Client process for individual Persons Resident Outside India
SEBI-Aug 14, 2026 | Reports : Reports for Public Comments
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Objective:
1. The objective of this consultation paper is to review the extant process for on-boarding of individual Persons Resident Outside India (PROI1) clients and invite public comments on the proposals to simplify the said process in order to enable seamless digital on-boarding in the securities market. The consultation paper also takes into cognizance of the various modes available to investors during the digital on boarding process. For the purpose of this consultation paper, individual PROI clients shall mean Non-Resident Indian (NRI)2, Overseas Citizen of India (OCI3) and foreign nationals, located outside India.
2. The individual PROI who seeks registration as a Foreign Portfolio Investor (FPI) shall be subject to the provisions of Master Circular for Foreign Portfolio Investors, Designated Depository Participants and Eligible Foreign Investors ref. no. SEBI/HO/AFD/AFD-PoD-2/P/CIR/2024/70 dated May 30, 2024.
II. Background:
2. SEBI Master Circular on Know Your Client (KYC) dated October 12, 2023, prescribes the requirements for KYC during the process of client on boarding including the form to be filled by clients (individual and legal entity), requisite supporting documents, verification/ validation of KYC records by KYC Registration Agencies (KRAs4), obligations of intermediaries and KRAs. These requirements have been specified in alignment with the provisions of the Prevention of Money Laundering Act, 2002 and the Prevention of Money-Laundering (Maintenance of Records) Rules, 2005 (PMLR), as amended from time to time.
3. The process specified in the KYC Master Circular5 includes the requirements for both resident and non-resident clients. One of the requirements for digital on-boarding of nonresident clients is that the location of such clients should be in India at the time of on-boarding.
4. SEBI has been receiving multiple representations from stakeholders seeking relaxation of the said provision of presence in India. Additionally, representations have been received regarding the requirements of verification of original Officially Valid Documents (OVDs), signature affixation, portability of KYC records, etc. In multiple inter-regulatory forums as well, the need for easing the KYC process for PROI clients has been deliberated upon.
5. To begin with, on December 10, 2025, SEBI issued a circular6 relaxing the requirement of geo-tagging to be in India for NRIs while undertaking re-KYC. This allowed NRI clients to undertake modifications in their KYC information with their intermediary from locations outside India.
6. In the Union Budget FY2026-2027, the Union Minister for Finance and Corporate Affairs announced that individual PROI will be permitted to invest in equity instruments of listed Indian companies through the Portfolio Investment Scheme which was hitherto available only to NRIs and OCIs; and the investment limit for individual PROI in any company was increased. Further, Ministry of Finance vide its notification dated June 12, 2026, amended the Foreign Exchange Management (Non-debt Instruments) Rules, 2019, to permit Foreign Nationals to invest in Indian securities without coming through the Foreign Portfolio Investment (FPI) route, in order to facilitate foreign investments in the country.
7. PROIs play an important role in the Indian securities market and represent a significant and growing pool of investment into India. Enabling smooth on-boarding would enhance market participation, make investing back home easier for the Indian diaspora (NRIs and OCIs) which would lead to channelization of overseas savings into Indian capital markets.
8. In view of the representations received from stakeholders and to facilitate the inflow of investment into the Indian securities market, the extant KYC process for PROI clients is being reviewed, to simplify digital on-boarding while being outside India as well. This shall also lead to ease of doing business for the intermediaries.
III. Steps involved in first-time KYC process of all clients:
9. As per extant regulatory framework, the steps involved in the KYC process for any client in the securities market is as follows:
| Step 1 | Step 2 | Step 3 | Step 4 | Step 5 | Step 6 | Step 7 |
| Fill | Provide self- | Verification | Client In | Upload of | Verification | KYC |
| KYC | attested | of originals | Person | KYC | of KYC | record |
| form | copies of | of OVDs/ | Verification | record on | information | created |
| and | OVDs/ | supporting | (IPV) including | KRA | with source | |
| sign | supporting documents | documents | liveliness
check and additional due diligence |
database | databases |
10. In specific, the different modes of on-boarding PROI client by the intermediary, are given below:
10.1. Client on-boarding while in India:
i. Physical: The individual PROI client may visit the office/ branch of intermediary or the authorised official of the intermediary may visit the PROI client. The PROI client submits the filled and signed KYC form and self-attested copy of the OVD or equivalent e-document thereof. The intermediary verifies the KYC form, original OVDs and undertakes In Person Verification.
ii. Digital: The individual PROI client submits the KYC information along with specimen signature online, through app, website or digital or submit scanned copy of signed and filled KYC form online under electronic/ digital signature (includes Aadhaar e-sign). Further, client submits the copies of OVD through Digi-locker or proof of possession of Aadhaar. The intermediary shall capture photo in live environment including liveliness check, capture latitude longitude with time-stamp to ensure client is in India, etc.
10.2. Client on-boarding while outside India:
i. Physical:
i. The individual PROI client may visit the office/ branch of intermediary or the authorised official of the intermediary may visit the PROI client. The PROI client submits the filled and signed KYC form along with self-attested copy of the OVD or equivalent e-document thereof. The intermediary verifies the KYC form, original OVDs and undertakes IPV.
ii. Alternately, the individual PROI client fills and signs the KYC form and shares the same with the intermediary along with certified copy7 of the OVDs, through courier.
iii. Digital: Currently, digital on-boarding of individual PROI client is feasible only when the location of the client is in India at the time of on-boarding.
IV. Need for review and proposed changes:
11. On account of the restriction that the latitude longitude of the client should be in India during online KYC process, the intermediaries are unable to provide complete digital on-boarding to individual PROI clients. The provision of submitting KYC form digitally using electronic/ digital signature, submission of OVDs through Digi-locker or digital Aadhaar authentication, IPV through video interaction, is currently not available for PROI clients while outside India. Therefore, it has become imperative to review the extant on-boarding process for PROI clients (while outside India), to identify and ease the concerns towards complete digital on-boarding.
12. In view of the above, the various stages in on-boarding an individual PROI client (while outside India), corresponding concerns and proposed solutions have been tabulated below:
Notes:
1 PROI is defined under Section 2(w) of Foreign Exchange Management Act, 1999 (FEMA), as “person who is not resident in India”;
2 In terms of section 2(30) read with section 2(42) of the Income Tax Act, 1961, “non-resident” means a person who is not a “resident”, and for the purposes of sections 92, 93 and 168, includes a person who is not ordinarily resident within the meaning of clause (6) of section 6; “resident” means a person who is resident in India within the meaning of section 6;
3 Overseas Citizen of India (OCI), defined under Section 2 (ee) of the Citizenship Act, 1955;
4 KYC Registration Agencies as per SEBI (Know Your Client Registration Agencies) Regulations, 2011;
5 SEBI Master Circular on Know Your Client norms in securities market, ref. no. SEBI/HO/MIRSD/SECFATF/P/CIR/2023/169 dated October 12, 2023 (KYC Master Circular);
6SEBI Circular on Relaxation on geo-tagging requirement in India for NRIs while undertaking re-KYC, ref. no. HO/38/30/12(1)2025-MIRSD-SEC-FATF dated December 10, 2025;
7 After verification of original, copy of OVD certified by any one of the following – authorised officials of overseas branches of Scheduled Commercial Banks registered in India, Notary Public, Court Magistrate, Judge, Indian Embassy/ Consulate General in the country where the non-resident customer resides;
8 Paragraph 51 of the KYC Master Circular;
9 Paragraphs 33 and 34 of the KYC Master Circular;
10 Paragraphs 46 and 48 (a and b) of the KYC Master Circular;
