The Foreign Contribution Regulation Act (FCRA), enacted by the Government of India in 2010, is a critical piece of legislation designed to regulate the acceptance and utilization of foreign contributions by non-governmental organizations (NGOs) and other entities. The primary goal of the FCRA is to ensure that foreign funds are utilized effectively for the social and economic betterment of Indian society, while preventing the misuse or diversion of these funds for unlawful activities. In this blog post, we will share the details of FCRA Act , Imporatnce of ACT, Registration Procedure for FCRA Act Stay tuned to learn more about the FCRA and its significance.
What is Foreign Contribution Regulation Act (FCRA)
The FCRA, passed by the Indian government in 2010, is designed to regulate the inflow of foreign donations and contributions to Indian NGOs and associations. The Act aims to ensure that these funds are used for purposes aligned with the welfare of Indian society, while also curbing any potential misuse that could undermine national interests, such as money laundering, financing terrorism, or promoting anti-national activities. Through this law, the government seeks to maintain transparency, accountability, and trust in the utilization of foreign funds by NGOs
The Importance of the FCRA Act for NGOs
For NGOs operating in India, FCRA registration is paramount. It serves as a safeguard, ensuring that foreign donations are monitored, transparent, and used exclusively for social welfare purposes. The Act plays an essential role in maintaining the integrity of NGOs by regulating foreign contributions, ensuring compliance with national security protocols, and protecting against misuse. The FCRA also enhances the credibility of registered NGOs, promoting their transparency and accountability to donors, government authorities, and the general public.
Benefits of having FCRA Registration NGOs
NGO's that are registered under the FCRA are eligible to receive foreign donations from foreign entities, individuals, or organizations. This registration also enables them to open a foreign currency bank account and receive foreign currency donations. Having FCRA registration enhances the credibility of the NGO and provides them with greater visibility and recognition.
Eligibility for FCRA Registration
To be eligible for FCRA registration, an association must meet the following criteria:
Registered under the Societies Registration Act, 1860, or the Indian Trusts Act, 1882, or section 8 of the Companies Act, 2013
Have an FCRA Account, i.e., a bank account with State Bank of India, main branch, New Delhi
Exist for at least three years and have undertaken reasonable activity in its chosen field for the benefit of the society for which the Foreign Contribution is proposed to be utilized
Have spent at least Rs. 15, 00,000/- over the last three years on the organization/association’s core activities this core activities conducted for the benefit of society during the last three financial years
Have a 12A registration certificate as well as a registration certificate.
Documents Required for FCRA Registration
The following documents are required for registration under FCRA:
Registration Certificate of Association
Memorandum of Association/Trust deed
Activity Report for the last three years
Audited Statement of accounts for the last three years
Affidavit of each key functionary
Chief Functionary signature
Seal of the Association
For more detailed information about the FCRA, please visit the official website here: FCRA Online Portal.
In our next blog post, we will discuss the process and procedure for obtaining Prior Permission Registration under the FCRA 2010. We will provide more details on eligibility criteria, documentation requirements, and the steps involved in obtaining Prior Pernission
If you are an NGO seeking assistance with FCRA registration or compliance, feel free to contact us. Our expert team can guide you through the registration process and ensure your organization remains compliant with all FCRA requirements.
Comments