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Canadians not allowed to invest in Indian MFs?

Most mutual funds have stopped accepting investments from American and Canadian citizens

I am a Canadian citizen with OCI card. I am a full-time resident in India and have no residential ties with Canada or any other country. I have been paying regular Income Tax in India for a few years now. Since my return I do not pay taxes in Canada since I don't have any residential ties with them. I don't have any non-resident accounts in India. All my accounts are in regular resident individual savings account. Am I not allowed to invest in mutual funds like any other Indian on a non-repatriable basis? I have approached four institutions who said that for some reason Americans and Canadians cannot invest in mutual funds in India. Is it true that citizens of these two countries are singled out for special treatment? Any particular govt guidelines that say so?
- Seshadri

Most mutual funds have stopped accepting investments from American and Canadian citizens. This is because of Foreign Account Tax Compliance Act (FATCA), which makes it mandatory for foreign financial institutions to report the details of investments by US citizens to the US authorities. However, some mutual funds like UTI, L&T accept investments from US and Canadian citizens.

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