FCRA Registration for NGO

Are you an NGO planning to receive funds from foreign sources? The Union Home Ministry issued a stern warning to NGOs, cautioning them about levy of severe penalties if they have been receiving and utilising foreign funds without proper FCRA registration or even after their registration has expired. In this article, we’ll explain the rules, conditions and steps you need to follow in simple terms to ensure your organisation stays compliant with the FCRA law.

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Summary of the Home Ministry’s Notification on FCRA Compliance

The Union Home Ministry on January 21, 2025 issued a stern warning to NGOs regarding initiation of penal action for receiving foreign funds without proper registration under the Foreign Contribution Regulation Act (FCRA), 2010. Key points from the notification are as follows:

• Mandatory FCRA Registration: No individual or organisation shall accept foreign contributions without valid FCRA registration or prior permission from the Central Government.
• Utilisation of Funds: Foreign contributions received must be used strictly for the purposes for which they have been granted.
• Renewal of Registration: Organizations with FCRA registration must renew their certificate at least six months prior to its expiry.
• Prohibition After Expiry: Organizations whose FCRA registration has expired or ceased to exist are not allowed to receive or utilise foreign contributions.

The relevant circular dated January 21, 2025 is enclosed for reference.

What is FCRA registration?

FCRA registration refers to the mandatory process under the Foreign Contribution Regulation Act (FCRA), 2010, that allows individuals, associations, or companies in India to legally receive foreign donations or contributions. Managed by the Ministry of Home Affairs, this registration ensures that foreign funds are utilised transparently and for the specific purposes for which they are intended.  

FCRA Registration for NGOs

Non-Governmental Organizations (NGOs) aiming to receive funds or donations from foreign sources must register under the provisions of the Foreign Contribution Regulation Act (FCRA). The Ministry of Home Affairs (MHA) provides two options for compliance: permanent registration or prior permission for specific contributions.

Permanent FCRA Registration

NGOs that have been operational for at least three years are eligible to apply for FCRA registration. To apply, NGOs must submit Form FC-3A along with the required documents for approval. This registration type is suitable for established organisations with a proven track record of social impact. For single (one-time) foreign contributions, NGOs can seek prior permission from the FCRA Section of the MHA.

Prior Permission for Accepting Foreign Donation

For newly established NGOs that haven't been operating for three years, they need to get special permission before accepting foreign donations. The NGO must have a specific project planned and a clear commitment from a foreign donor about the donation's purpose and amount. The Ministry of Home Affairs (MHA) will review each case individually and decide based on the project and the donor's commitment. To apply for the proper permission, NGOs need to use Form FC-3B. For regular or multiple contributions, permanent registration is recommended.

Why NGOs Need FCRA Registration?

NGOs need FCRA registration to legally accept foreign donations, ensuring that the funds are used properly and for the intended purposes. It helps them stay compliant with Indian laws, avoid penalties and maintain transparency. Without FCRA registration, NGOs can face serious consequences like fines, seizure of funds and the inability to receive foreign contributions.

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Mandatory Requirements for NGO FCRA Registration

To successfully apply for FCRA registration, an NGO must fulfil the following essential requirements:

• Legal Registration: The NGO must be registered under an applicable Indian statute, such as the Societies Registration Act, 1860, Indian Trusts Act, 1882, or Section 8 of the Companies Act, 2013.
• NGO Darpan ID: The NGO must be registered on the NITI Aayog portal and obtain an NGO Darpan ID, which is necessary to complete the FCRA registration process.
• FCRA Bank Account: The organisation must open a dedicated FCRA bank account. This account will be used exclusively for receiving foreign contributions.
• Aadhaar for Key Officials: The Aadhaar number of all key office bearers must be provided with the application. For foreign members managing the NGO in India, a passport or OCI card is required.

FCRA Bank Account for NGOs

NGOs must open a dedicated bank account exclusively for receiving foreign contributions, separate from other operational accounts. The details of this designated account must be provided in the FCRA application. The Ministry of Home Affairs will notify the bank to monitor the use of foreign funds and report any discrepancies or irregularities. 

Existing FCRA-registered organizations are prohibited from receiving foreign donations in any account other than the designated FCRA account. New applicants, however, are required to open their FCRA account only after receiving the FCRA certificate from the Ministry of Home Affairs.

Renewal of NGO FCRA Registration

FCRA registration is valid for five years and NGOs must apply for renewal before the certificate expires to continue receiving foreign contributions. 

As per the latest guidelines, NGOs are required to submit their renewal application at least six months before the expiry date. Failure to do so may result in penalties.

Documents Required for NGO FCRA Registration

Please ensure that the following documents are ready to upload as part of the FCRA registration application process.

Documents Required for Permanent FCRA Registration

• Registration Certificate of Association (self-certified by the chief functionary)
• Memorandum of Association / Trust Deed (self-certified by the chief functionary)
• Activity Report for the Last 3 Years
• Audited Statement of Accounts for the Last Three Years

Documents Required for FCRA Prior Permission

• Registration Certificate of Association (self-certified by the chief functionary)
• Memorandum of Association / Trust Deed (self-certified by the chief functionary)
• Commitment Letter from the Donor Organization and Agreement
• Project Report for which FC will be received

Documents Required for FCRA Registration Renewal

• Registration Certificate of Association (self-certified by the chief functionary)
• Memorandum of Association / Trust Deed (self-certified by the chief functionary)
• FCRA Registration Certificate of Association Issued by MHA

Procedure for NGO FCRA Online Registration/Renewal  

The procedure to obtain NGO FCRA Online Registration or Renewal is outlined here in simple and easy-to-follow steps.

Step 1: Visit the FCRA Portal

Start by visiting the official FCRA portal provided by the Ministry of Home Affairs (MHA), where all registration procedures are conducted. Click on the "Services under FCRA" section tab.

Step 2: Select Application

Depending on your requirements, choose one of the following:

• FC-3A: For FCRA Registration
• FC-3B: For Prior Permission Registration
• FC-3C: For FCRA Renewal
• FC-4: For Filing FCRA Annual Return  

 After selecting the desired form, the system will redirect you to the relevant application page.  

Step 3:  Start the Application

Click on the "Click to Apply Online" button to proceed with your application.

Step 4: Create an Account or Log In

• New User: Click on "Sign Up Here" to create a new account.
• Existing User: Log in with your credentials to continue.

Step 5: Create a Login ID

Click on the “Sign Up” button on the portal to create a login ID and password. After successfully registering, you will receive a confirmation message. Use your login credentials to access the FCRA portal.

Step 6: Select the Appropriate Registration Option

Once logged in, select the correct option for your NGO from the dropdown menu under “I am applying for”:

• FC-3A for FCRA Registration
• FC-3B for Prior Permission Registration
• FC-3C for FCRA Renewal
• FC-4 for Filing FCRA Annual Return

Step 7: Complete the FC-3 Form

Depending on the registration type chosen (FC-3A, FC-3B, FC-3C), fill out the corresponding FC-3 form. You will need to provide detailed information about your NGO, including its registration details, Darpan ID (if available), nature of the NGO and other required information.

Step 8:  Enter NGO and Executive Committee Details

Provide essential details about your NGO, such as:

• NGO Address
• Registration Number and Date
• Main Objectives and Nature of the NGO

Also, enter the details of your Executive Committee, including the key office bearers. You can add, edit, or delete these details as necessary by using the “Add details of Key Functionary” option.

Step 9: Provide Bank Details

Enter the required FCRA bank account details, including:

• Bank Name
• Account Number
• IFSC Code
• Bank Address

The FCRA account must be opened at the SBI New Delhi Main Branch, which is required for receiving foreign donations.

Step 10: Upload Required Documents

Ensure that all necessary documents are uploaded in PDF format, adhering to the size and format guidelines provided on the MHA portal.

Sep 11: Finalize the Application

After reviewing the form, fill in the place and date fields. Double-check all the details and click the "Final Submission" button to submit your application.

Step 12: Make Payment

Once the application is submitted, complete the registration by making the online payment. The government fees will vary depending on the registration type (normal, prior permission, or renewal). Please note that once the payment is made, no further changes can be made to the application form.

Step 13:  Confirmation and Registration

After the payment is processed, your application will be considered complete. You will receive a confirmation and the FCRA registration process will be finalised. You can track the status of your application on the FCRA portal. If you're undergoing renewal, you can also track the renewal status.

Filing FCRA Annual Return

If your NGO or trust is registered under FCRA and receives foreign donations, you are required to file an annual return with the Ministry of Home Affairs. The annual return giving details of the receipt and purpose-wise utilisation of the foreign contribution must be filed for every financial year (from 1st April t to 31st March) and must be submitted within nine months from the end of the financial year, i.e. by 31st December.

The annual return should be accompanied by balance sheet and a statement of receipts and payments, which  is certified by a Chartered Accountant. The return should be filed using Form FC- 6, which can be conveniently submitted through the FCRA online portal.

Submission of a ‘Nil’ return, even if there is no receipt/utilization of foreign contribution during the year, is mandatory.

Check Validity of FCRA Registration Certificate

Before accepting any foreign contributions, it's essential to verify the validity of your FCRA registration certificate. Follow these steps to check its status:

• Visit the Home Page of the Ministry of Home Affairs (MHA) FCRA portal.
• Click on the FCRA Registration Number section.
• Enter the Access Code provided.
• Check the validity of your certificate. If it has expired, be sure to renew it promptly to continue receiving foreign contributions.

Penalties for Non-Compliance

The government has made it clear that strict action will be taken against NGOs that receive foreign funds without proper FCRA registration. Violation of FCRA rules can lead to severe penal action. Below is a summary of the penalties under the FCRA:

• Penalty for Accepting Foreign Contribution Without Registration:  If an organisation accepts foreign contributions without obtaining the required registration from the Central Government (as per Section 11), the penalty is ₹1,00,000 or 30% of the foreign contribution received, whichever is higher.
• Failure to Report Receipt of Foreign Contribution on Time:  For failing to report the receipt of foreign contributions within the prescribed time limit (under Sections 3, 11, and 35, read with Rule 6 of the FCRA Rules), the penalty is 5% of the total foreign contribution received in a financial year.
• Failure to Report Opening of Account(s) on Time: If an organisation fails to report the opening of a foreign contribution account within the prescribed time (under Sections 37, 17, and 19 of the Act, read with Rules 9(1) and 9(2)), the penalty is ₹10,000 per utilisation account for failure to notify within the prescribed time.
• Failure to Provide Required Details on Time: For failure to provide required details (under Sections 37, 11, and 17, read with Rule 17A), the penalty is ₹10,000 for each violation of delayed reporting.
• Failure to Upload Information on the Website: If an organisation fails to upload required information on its website (under Sections 37 and 19 of the Act, read with Rule 13), the penalty is ₹10,000 for each instance of delay.

Here’s a simple table summarising the penalties under the FCRA:

Avoid Penalties for Your NGO – Get Your FCRA Registration Today!

Don't risk imposition of penalties for your NGO! Ensure your FCRA registration is in place or renew it before it expires. Our experts at IndiaFilings can guide you through the entire process, making it simple and hassle-free. Get started today and stay compliant with FCRA regulations!

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