NRI Guide to Investing in an Indian Franchise from Abroad in 2027

Buying a franchise in India can require anything from a few lakh rupees to several crores. The amount depends on the brand, business format, city, premises, equipment and working capital you need to keep the business running.

However, the franchisee fee that the franchise advertises is just one part of the total amount of money that you might have to invest. In addition to this, you may also have to make payments for property security deposit, fit-out expenses, staff payroll, initial stock, licenses, and royalties.

If you are an NRI intending to invest in a franchisee from abroad, then there are some other matters that need to be sorted out – ownership of the business, means of funding the investment, management of the business, and regulations regarding overseas transfer of eligible earnings.

This article talks about the different costs that you might incur while investing in a franchisee, and how to assess the investment figures quoted by franchises.

For example, according to the information given by Amul's official franchise business opportunity page, setup cost of its parlor formats ranges from approximately ₹1.5 lakh to ₹6 lakh, excluding property cost.((Source checked: 15 October 2026.)

 The FranchiseBazar website listing different types of franchise, starting from small-format food franchises to bigger gym and retail franchises. These are indicative costs and may change based on your actual investment need.

For Non-Resident Indians (NRIs), the cost calculation must also consider local management, professional advice, applicable Indian regulations, taxes and financial reporting.

Quick Answer: Before deciding on any franchise business, it is necessary to add up all costs required for the startup, including the working capital costs. You should not take the quoted cost of the franchise alone.

Franchise Business Cost in India: Comparison according to Budget

The franchise costs are different according to the nature of the business. Below is the cost comparison of some franchises along with other budgeting considerations.

Sources: FranchiseBazar’s current opportunity directory. Amul’s webpage should be directly reconfirmed because website information may not reflect current terms. FranchiseBazar figures are  range of directories, not the quotations from all brands.

What does the total franchise investment include?

The franchise fee is only one part of the total setup cost. Request an itemized list including:

• Franchise Fee: this is the fee that the franchisor uses for the franchise brand.
• Property: Security Deposit, Rent in advance, real estate commission, Fit-out cost.
• Initial Inventory: Goods/ingredients/teaching material.
• Staff: Hiring of staff and training.
• Fees: Necessary license, fees, and professional charges.
• Working Capital: Working capital required for payment of rent, salary, utility bills, and initial stock of goods before revenue.
• Ask the franchisor which costs are included, which are excluded and which depend on your chosen location

Example: How to Calculate the Total Cost of a Franchise in India

The total investment in a franchise includes more than the initial franchise fee. Investors should budget for setup expenses, property costs, initial stock, professional fees and working capital.

Consider the following hypothetical example of a small franchise business:

Here, for instance, the approximate initial capital required is ₹17 lakhs. This is only for reference purposes, and no quotes have been taken from any brand of franchises.

• Before moving on further, you will have to replace each reference value by a current quote in writing or estimation according to the location. It should be verified whether the estimation includes tax, deposit, equipment, royalty, etc.
• How to Calculate the Price of a Franchise Before Investing in it?
• To use this technique to convert the cost quote to a common basis, follow these steps:
• Find the franchise at the official site of the brand or any credible directory.
• Note down the required investment along with the source and date of verification.
• Ask for a current quote in writing from the franchisor.
• Make sure the cost figure includes the cost of taxes, equipment, security deposit, inventory, and working capital
• Also find out about the royalty system and other charges.
• Compare your quotation to your needs in the selected location.

Until the franchisor verifies all the data, call the amount the advertised investment range, not the total investment.

What are the Right Franchises for NRIs to Pursue?

The most appropriate franchise business opportunity in India for NRIs would depend on the amount of capital they have along with their demand, complexity of operation, and the kind of supervision that the owner would be able to give.

Education & Coaching: The franchises in the category of preschools, coaching centers and vocational training model can provide predefined education models. Analyze the assumptions, staffing, enrollment criteria and training support provided by the franchisor.

Food & Beverages: Although cafes, takeaways and fast food outlets could employ the product standardization method, the following points need to be taken into consideration: food safety, inventory control, supervision of employees, and customer service.

Retail: The franchises in the categories of fashion, food, beauty, and specialty stores will prove to be beneficial to NRIs that would like to work on product standardization. Research regarding inventory, suppliers, deadstock, and rentals needs to be conducted.

Service businesses: Laundries, cleaners, logistics and some other business services may have different inventory and space requirements than the usual retail stores. Look at staffing, services offered, potential customers and equipment costs.

Find potential franchises from FranchiseBazar's franchise list and validate the information from the respective franchisor.

However, do not go ahead with the business simply because it involves lower start-up costs. Compare total capital expenditure, contract terms, operational costs of conducting the business and your capability to conduct the business from remote locations.

Is investment by the NRI into a franchise business in India legal?

Any investment made by NRIs in an appropriate business in India is legal but again, it depends on the type of business, residency position, form of business, sources of investment, and other relevant laws that may apply to that specific business.

A franchise agreement will not necessarily make your business form legal. Please seek professional advice from chartered accountants in India.

Investment and repatriation

Repatriation involves withdrawal of eligible investment income from India through proper procedures under laws and taxes.

There might be various requirements depending on the type of investment and whether such investment is non-repatriable or repatriable.

Under The Reserve Bank of India’s Foreign Exchange Management (Non-Debt Instruments) Rules, 2019, there are certain rules related to some investments of NRIs and OCIs.

Please consider what rules apply to you specifically in terms of your investment and any modifications thereof.

Please do not assume that the same set of rules for listed shares applies to the proprietorship, partnership, LLP or company franchise.

Before you invest, check:

• Whether your planned structure is allowed or not.
• What are the applicable FEMA and RBI rules for your business activity.
• Whether there are any sectoral restrictions or approvals.
• How this investment will be funded.
• Whether profits or sales proceeds can be taken out of the country.
• Indian and foreign tax liabilities.

The Income Tax Department's guidance for non-residents is the first step in comprehending Indian taxation.

Seek professional help before signing the agreement and making payments. This section contains general educational material only and not an individual legal or tax opinion.

NRI Franchise Readiness Scorecard

Before investing, rate yourself in these six categories:

Grade each section from 1 to 5, with 1 being not ready and 5 being very ready. A low grade shows an area that needs attention but is not indicative of profitability. No matter what the total score, there will be no success without sorting out any legal, financial or management issues.

How Could NRIs Run a Franchise Business From Abroad?

Successful remote operation depends on clear roles of all involved parties and having reliable access to information about the business operations.

Have a skilled local manager and specify his/her rights to recruit, make purchases, approve suppliers and make payments. Utilize accounting software and a POS system to keep track of sales, expenses, inventory and cash flow.

Request documentation for all major payments and analyze the performance of the business monthly against the business plan. Research any unusual fluctuations in the figures of revenue, inventory, expenses or complaints from customers.

If possible, conduct regular visits or get operational audit. In case you can't make visits frequently, think of finding an independent expert who would conduct visits to the business premises and check its documentation.

How Should NRIs Calculate Franchise Returns?

Evaluate the franchise by taking into account realistic cash flows and not just the profits.

The simple payback formula will be:

Payback period = Initial investment / Annual net cash flow

For instance, assume that the initial investment needed for a franchise is ₹30 lakh, with annual net cash flow of ₹6 lakh after deducting operating costs. The simple payback period will then be five years.

This is an imaginary example and does not represent an actual franchise forecast or return. It may vary depending on changes in sales, costs, and capital required.

Prepare an itemized budget for the investment

Before you invest, determine:

Afterwards, you need to create conservative, realistic and positive scenarios for your cash flows which include salaries, rent, royalties, taxes, maintenance fees, and local management fee. Find out whether the business will be profitable even if there is lower income than expected.

Try to obtain any documentation from the franchisor regarding any of your income estimates and compare with other franchises’ data.

 Do not take any projections of returns or payback period as an absolute certainty.

Checklist of NRI Franchise Investment

Prior to making any commitments or payments:

Request a written estimate of the total cost involved in the project.

Ascertain whether the total cost figure takes into account all taxes, deposit, equipment, and working capital.

Contact the existing franchisees in person.

Seek professional help regarding legal and structural aspects of business.

Review your finances, taxes, and repatriation procedure.

Get your franchise agreement checked independently.

Make provision for local management and introduce financial controls.

Prepare realistic cash flows and payback scenarios.

Save some money for contingencies.

faqs

How much does it cost to buy a franchise in India?

Costs can vary from a few lakhs for some small-format franchises to a few crores for larger businesses.

Can an NRI open a franchise business in India?

NRI’s have the option of considering the investment opportunities based on their eligibility and in compliance with foreign exchange regulations, industry constraints and other legal aspects. Consult a professional on the suitable investment option before investing.

Can I run the Indian franchise from outside India?

Yes, provided that the particular business model suits the remote management and requires a trustworthy local manager, accounting procedures, defined roles and periodic performance evaluation.

Can I remit the franchise earnings to my foreign bank account?

It will depend on the type of investment made, foreign exchange rules and tax and banking conditions. Clarify the position in advance before investing.

Which franchise is better for NRIs?

There is no particular franchise suitable for NRIs. Compare the total cost of investment, local market demands, complexity of the business, franchisee comments, terms of agreement and supervision requirements.

What aspects should be considered prior to making the payment for the franchise rights?

A written quotation should be sought, terms of the franchise agreement should be considered, claims of the franchisor should be confirmed, contacts with other franchise holders should be made and professional legal and taxation advise should be taken into account. In no case should money be transferred upon advertising and verbal claims alone.

Conclusion

The cost of purchasing a franchise in India will depend upon the business model, geographical location and operational costs. In case of NRIs, choosing a franchise is also about assessing the legal issues involved, foreign exchange requirements and the logistics of managing from a distance.

You can start by identifying the franchise options which fit within your budget and get current written estimates of all significant costs involved. Get independent verification of all legal and tax arrangements.

Written By: Gouri Ghosh, Franchisebazar Editorial Team — Updated October 2026

Disclaimer: The brands mentioned in this blog are the recommendations provided by the author. FranchiseBAZAR does not claim to work with these brands / represent them / or are associated with them in any manner. Investors and prospective franchisees are to do their own due diligence before investing in any franchise business at their own risk and discretion. FranchiseBAZAR or its Directors disclaim any liability or risks arising out of any transactions that may take place due to the information provided in this blog.