Investing in the US stock market has become a hot topic among Indian investors. Whether it’s to diversify portfolios, tap into global giants like Apple, Nvidia, or Tesla, or hedge against rupee depreciation, the appetite for international exposure is growing.
But how do you actually invest in US stocks or ETFs from India? Well, under the Liberalized Remittance Scheme (LRS) there are two primary methods: direct and indirect.
In this blog, we’ll walk you through the details of both these methods, explain how they work, and show you the step-by-step process of investing through platforms like IndMoney, Vested, and Interactive Brokers. By the end, you’ll know which method might be the best fit for you, along with an understanding of the fees and charges involved at every step.
Note: We have discussed all the options available to invest in the US market and issues with them here. This blog focuses more on options under LRS.
Estimated read time: 3 minutes and 29 seconds
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Buckle up. Here we go!
Before we dive into the methods, let’s quickly explain LRS.
What is the Liberalized Remittance Scheme (LRS)?
Under the Liberalized Remittance Scheme (LRS), the Reserve Bank of India allows Indian residents to remit up to $250,000 per financial year to invest in foreign markets, including the US stock market. If your remittances exceed this amount, you’ll need RBI approval.
However, recent changes introduced a Tax Collected at Source (TCS) of 20% on remittances above ₹10 lakhs in a year (Increased from ₹7L in budget 2025). Remember, this 20% is not a tax burden; it’s just collected upfront and can be adjusted when you file your taxes.
Now that we’ve got the LRS basics out of the way, let’s move to how you can actually invest.
Direct Method: Investing Directly via US Brokers
This method involves creating an account directly with a US-based broker like Interactive Brokers or Charles Schwab. These brokers allow you to buy and sell US stocks and ETFs just like you would in India. Since they operate in India, opening an account is straightforward.
Step-by-Step Process for Investing Directly:
- Create an Account: Visit the Brokers website. Sign up for a new account and provide the required KYC documents (passport, PAN card, etc.).
- Fund Your Account via LRS: Transfer funds using your Indian bank account via LRS. Brokers will provide details on how to wire transfer the money from your Indian bank account.
- Conversion of INR to USD: While you transfer funds from your Indian Bank to your US broker’s account your INR is automatically converted to USD.
- Start Investing: With USD in your trading account, you can now buy US stocks, ETFs, and bonds through the Brokers platform. Many brokers also allow you to invest in ETFs of other countries as well.
Charges and Fees:
- Account Opening: Free
- Currency Conversion & Remittance Fee: Typically 0.5%–2% of the transferred amount
- Brokerage: Minimum $0.35 per trade
- Annual Maintenance: No annual maintenance fees
- Withdrawal Fees: 1 free withdrawal every month
Indirect Method: Investing via FinTech Startups
Now, if you prefer a simpler approach where you don’t deal directly with US brokers, FinTech platforms like IndMoney, Vested and Appreciate are your go-to options. These platforms collaborate with US brokers to facilitate investments in US stocks and ETFs. This means you don’t have to deal with the US brokers.
Step-by-Step Process for Investing Indirectly:
- Select a FinTech App: Select any FinTech based on your preferences.
- KYC Verification: Complete the KYC verification by submitting documents such as your PAN card, Aadhaar, and bank details.
- Create a US Trading Account: The FinTech app will help you open a US trading account with their partner broker like DriveWealth.
- Fund Your Account: Once your account is open, you can transfer INR to USD through the app using LRS. The app will guide you through the process.
- Invest in US Stocks/ETFs: Once your funds are converted to USD and appear in your account, you can start investing in US stocks and ETFs directly from the FinTech app.
Charges and Fees:
- Account Opening: Free
- Currency Conversion & Remittance Fee: Typically 0.5%–2% of the transferred amount
- Brokerage: 0.25% per trade
- Account Maintenance: No annual maintenance fees
- Withdrawal Fee: $0 to 5 per withdrawal
How Do These Methods Compare?
1. Direct Method (Interactive Brokers, Charles Schwab):
- Pros: Direct access to US stock markets, lower transaction fees, no middleman. Full control over investments.
- Cons: Slightly more complicated, hands-on experience.
2. Indirect Method (IndMoney, Vested, Appreciate):
- Pros: Easy-to-use apps, seamless process, and everything managed on a single platform. Suitable for beginners.
- Cons: Higher brokerage and withdrawal fees. FinTechs can change their partnered US broker anytime – low reliability.
Which Method is Best For You?
The choice between direct and indirect methods boils down to your comfort level with handling the investment process and fees:
For Beginners: If you’re new to investing in US markets, indirect platforms like IndMoney, Vested and Appreciate offer a much easier user experience. They handle all the complex processes in the background, so you can focus on picking your investments.
For Experienced Investors: If you’re comfortable with hands-on experience and want lower fees, direct platforms like Interactive Brokers are a better fit. You’ll save on brokerage and withdrawal fees in the long run.
Final Thoughts
Investing in US stocks as an Indian investor has never been easier. Whether you choose a direct method via Interactive Brokers or an indirect method through IndMoney or Vested, you can access global markets and diversify your portfolio.
We recommend you go through the direct method since we have observed Indian FinTechs changing their pricing structure a few times while offering some subscriptions. Currently, most FinTechs have partnered with US broker DriveWealth and we are not sure what happens if they change the partner. So the direct method will be more reliable in the long run and offer cost benefits.
However, for beginners, if you investing a small amount and don’t have enough time to figure things out then you can go with the FinTech platforms as they have simplified the entire process and made investing hassle-free.
Choose the method that aligns with your investment goals and comfort level.
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Still Curious?
If you are like us, who likes to analyse a little more or check out content in different formats, well you are in luck. Below you can find some suitable content we found.
Pranay Kapoor – Why I use Interactive Brokers from India and not Vested or INDMoney (YT video)
Capitalmind – What they don’t tell you about investing in US Stocks from India (Blog)
Mint – Step-By-Step Guide To Using LRS For Overseas Investments (YT video)
Note: We don’t have any affiliation with them. We are sharing links only for educational purposes. The opinions expressed by them belong solely to them and do not reflect the views of Vrid.
