Can an NRI be your nominee for a PPF, NSC or SCSS account?

You’ve opened a PPF, NSC, or SCSS account. Your money’s here, but your loved ones are now abroad. Can you still name them as your nominee in small savings schemes?

The short answer: Yes, you can. But there are a few important things to keep in mind.

What the rule says

Until mid-2023, Non-Resident Indians (NRIs) weren’t allowed to be nominees for small savings schemes governed by the Ministry of Finance. This created challenges for many account holders whose closest family members lived overseas.

Now, that has changed. NRIs can now be nominated across a range of schemes, including:

• Public Provident Fund (PPF)
• National Savings Certificate (NSC)
• Senior Citizen Savings Scheme (SCSS)
• Kisan Vikas Patra (KVP)
• Monthly Income Scheme

This update reflects today’s global family structures and gives account holders greater flexibility in succession planning.

But what’s the catch?

While NRIs can now be nominated, the payout, or receiving the money, comes with restrictions.

If an NRI inherits money from any of these schemes:

• The money must be received in an Indian bank account on a non-repatriation basis.
• It can’t be sent abroad freely—the nominee must comply with FEMA (Foreign Exchange Management Act) rules and repatriation limits to transfer the money overseas.

So, it's essential that the nominee has or opens an Indian bank account to access the money.

Can NRIs open these accounts?

This is where confusion often arises. While NRIs can now be nominees, they cannot open new accounts in most small savings schemes like PPF, NSC, SCSS, or KVP.

However, if someone becomes an NRI after opening an account while they were a resident in India:

• They can continue holding the account until maturity.
• However, they cannot extend or make new contributions after becoming a non-resident.

Final word

You can now name an NRI as a nominee in your small savings account. Just ensure they’re ready to receive and manage the money as per the rules.

And finally, don’t forget to keep your nomination details updated. It’s a small step that can save your family unnecessary paperwork and hassle down the line.

Also read: How can a nominee claim mutual fund investments?

This article was originally published on May 30, 2025.