Earning overseas while investing in India puts NRIs in a uniquely strong position. You have access to two financial systems, two currencies, and a wider set of wealth-building opportunities. But with banking rules, account types, repatriation limits, and tax structures all working differently for non-residents, the process doesn’t always feel as straightforward as it should.
This is where clarity matters. Knowing which instruments work for NRIs, how each one plays out, and what you need to set them up can make the entire process far more manageable; whether you’re looking for stability, diversification, or a steady INR-linked income stream.
This blog helps you break down why an increasing number of NRIs prefer monthly income from India, how you can manage your income setup when you’re not in the country and multiple investment options you can invest in. Let’s get started.
Why NRIs are Choosing Monthly Income from India?
India continues to stand out as one of the fastest-growing large economies in the world; a momentum reflected not just in GDP numbers, but in the way its capital and debt markets have expanded in depth as well as participation. It should come off as no surprise then, that many NRIs prefer to route a portion of their wealth back home.
Another reason NRI investments in India have been rising is the simple contrast in returns. Many NRIs live in developed markets where the economies are mature, and fixed-income yields naturally sit lower. India, on the other hand, still offers comparatively higher payouts across multiple debt avenues. Currently, ten-year government bond is hovering around 6.5%, corporate bonds offer 8% to15%, and small finance bank or NBFC fixed deposits reach about 8.5% (as of Dec’25).
In simple words, India gives NRIs access to better yields without requiring constant monitoring or full-time involvement. So, how can you turn these opportunities into steady monthly inflows?
Investment Routes NRIs Can Use to Build Reliable Monthly Income
Let’s look at a few investment paths that can help you establish a dependable month-on-month income, tailored to different financial needs and circumstances.
Government and Corporate Bonds
If you prefer predictability, Indian bonds are among the cleanest ways to earn a fixed income.
- Government securities are considered amongst the safest debt securities in India. You can invest in both long-term and short-term securities, like treasury bills, etc.
- Most investment-grade corporate bonds can offer 8% to 15% annualized returns. However, you should do your due diligence before investing in private bonds.
For those who prefer bank-backed security to market swings, fixed deposits come next.
Fixed Deposits (FDs)
FDs remain one of the most favorite investment avenues for conservative investors. Currently, the interest rates of FDs at major Indian banks range from 6–7.50%, while FDs with small finance banks and NBFCs can offer as high as 8.5%.
Here’s how the three main FD variants differ for NRIs like you:
- Non-resident external (NRE) account: Rupee-denominated; principal and interest are fully repatriable; interest is tax-free in India.
- Non-resident ordinary (NRO) account: Best for income earned in India (like rent or dividends); interest is taxable at source (~30 % TDS).
- Foreign currency non-resident (FCNR) deposit: Held in foreign currency (USD, GBP, etc.), eliminating exchange risk; interest is tax-free in India.
You often maintain a mix of NRE and NRO accounts to balance tax efficiency and liquidity.
Once your safety nets are set, it’s time to add market-linked income; enter mutual funds.
Mutual Funds
India’s mutual fund industry now manages over ₹ 79.79 lakh crore as of October 2025, nearly triple of what it did five years ago. This reflects both trust and accessibility.
As an NRI, you can choose:
- Debt funds for stability and regular interest
- Hybrid or balanced funds combining growth and income
- Equity and flexi-cap funds for higher long-term potential
Many mutual fund houses allow Systematic Withdrawal Plans (SWP) that acts like a “monthly income” setup from your accumulated corpus.
And if you want something more tangible than paper assets, India’s property and infrastructure sectors have re-entered the spotlight.
Real Estate and REITs
India’s real estate sector raised ₹23,080 crores in FY 25; its best in seven years. With rental yields of 2% to 4% for residential and 6% to 9% for commercial properties, the sector has regained investor confidence.
For those who prefer a hands-off approach, real estate investment trusts (REITs) offer exposure to office spaces and malls, paying dividend-like distributions quarterly. These can be held through Indian demat accounts and repatriated under RBI norms.
But beyond property and funds, long-term wealth needs structured planning, and that is where you have many government-backed options available.
National Pension System (NPS)
NRIs (except OCI cardholders) can invest in NPS (Tier-I and Tier-II) through NRE/NRO accounts. Contributions are invested in a mix of equity, government, and corporate bonds, with potential annual returns between 6-10% over the long term.
At the age of 60, up to 60% of the corpus is tax-free, while the rest is used to buy an annuity providing monthly pension income.
And if you enjoy following the markets, equity investing remains India’s most dynamic wealth engine.
After selecting the right investment avenues, the real task is setting them up for smooth operation; aligning your accounts, transfers, and compliance, so your income works globally without disruption.
How to Manage Your Income Setup While Living Abroad
Creating and managing an aboard investment setup requires putting a few foundational systems in place so your money arrives, stays organized, and gets reinvested without manual effort. Here’s how you can do it.
- Using the right account mix: NRE or FCNR accounts may support repatriable income, while NRO accounts can help manage earnings generated within India.
- Relying on automation: Standing instructions for deposits, SIPs, SWPs, or reinvestments can keep your portfolio running on schedule without frequent manual intervention.
- Monitoring inflows periodically: Tracking interest, dividends, and rental income through bank dashboards or investment apps offers clarity on how each stream is performing.
- Redirecting surplus income: Some investors choose to reinvest excess cash into another income-generating layer instead of leaving it idle.
- Staying aware of currency movement: Observing INR fluctuations against your country of residence may help in planning how your Indian income fits into your broader financial landscape abroad.
Putting this structure in place ensures your monthly income flows reliably and with minimal supervision. Now, the final step is understanding how much of that income you actually retain; which is shaped by India’s tax and regulatory rules for NRIs.
Key Tax and Regulatory Rules for NRIs
| Asset Type | Tax Treatment (India) | Repatriation Rules |
| Govt/Corporate Bonds | Interest generally taxed at slab rates for NRIs. Capital-Gains under new regime: LTCG at 12.5%, STCG at slab/20% depending on holding period/type | If held via NRE/FCNR; fully repatriable. If held via NRO → repatriation under USD 1 million/year cap (cum-income/assets) per RBI rules |
| FDs—NRO | Interest taxable at slab rate; TDS ~30% | After tax, funds in NRO can be repatriated up to USD 1 million per FY, subject to Form 15CA/15CB |
| FDs—NRE/FCNR | Interest is tax-free for NRIs | Fully repatriable (principal + interest) without restrictions |
| Debt Mutual Funds | For units bought on or after 1 April 2023; gains taxed at slab rate (no LTCG benefit). For older (pre-Apr 2023) units; standard LTCG/STCG rules may apply (12.5% / 20% + surcharge/cess depending on holding) if held for more than 24 months | Via NRE; repatriable fully Via NRO; subject to USD 1 million/year limit |
| Equity Mutual Funds (or Listed Stocks) | STCG 20%, LTCG 12.5% (with threshold benefit) under new regime | Via NRE/PIS; fully repatriable Via NRO/PIS; repatriation subject to USD 1 million/year cap |
| REITs/InvITs | Distribution (dividend/interest); often subject to TDS (slab or concessional depending on structure) Capital gains on sale → CG rules similar to equity (LTCG 12.5%) | NRE/PIS → fully repatriable NRO up to USD 1 million/year limit |
| Real Estate—Rental Income | Rented income taxed at slab rates after standard deduction under Sec 24; tenant must deduct TDS ~30% under Sec 195 | Rental income repatriation via NRO is subject to USD 1 million/year limit |
| Real Estate—Sale of Property | On sale after holding > 2 years LTCG @ 12.5% (post-2024 CG regime) + surcharge/cess | If property was bought with foreign funds (NRE/FCNR), you can repatriate sale proceeds for up to 2 residential properties; further properties require NRO route or RBI approval; subject to USD 1 million/year limit |
| National Pension Scheme (Tier I only) | On withdrawal/exit: 60% lump sum tax-free, 40% annuity taxed at slab | Annuity payments/withdrawals can be repatriated (subject to NRE/NRO rules) |
Final Thought: Keeping your Money Flowing Seamlessly while Living Abroad
Building a steady monthly income from India ultimately comes down to creating the right structure by choosing suitable instruments, organizing the appropriate accounts, and staying compliant with the rules that govern non-resident investing.
When these elements work in harmony, your inflows become consistent and far easier to manage from overseas. You can begin with dependable income sources, automate routine actions, and allow your India portfolio to reinforce your broader financial strategy with minimal effort.
