FCRA Registration: Complete Guide for NGOs to Receive Foreign Funding in India

India has thousands of NGOs operating to bring positive changes in the sectors of education, healthcare, rural development, child welfare, and others. To function at a large scale, the majority of these organizations approach foreign donors, philanthropists, and international funding agencies for assistance.

However, foreign funds received in India is not as straightforward as getting a bank transfer. It is controlled under a unique law called the Foreign Contribution (Regulation) Act (FCRA), 2010. Any trust, society, organization, or company who wishes to accept foreign donations is required to have FCRA Registration from the Ministry of Home Affairs (MHA), Government of India.

This blog is a comprehensive guide to FCRA registration—what it is, why it is necessary, who needs it, eligibility, documents required, application process, compliance rules, and mistakes to be avoided.

What is FCRA?

The Foreign Contribution (Regulation) Act, 2010-briefly known as FCRA—was enacted to control the acceptance and utilization of foreign contributions in India.

The purpose of this act is:

• For the purpose of preventing foreign funding from influencing political, economic, or social choices at the national level.

• To increase transparency and accountability of NGOs, charitable trusts, and other organizations receiving foreign aid.

• In order to prohibit the abuse of foreign funds into activities that affect national interest.

In brief, no NGO or organization can receive foreign funds without FCRA registration or prior government sanction.

What is FCRA Registration?

FCRA Registration is the legal permission granted by the Ministry of Home Affairs (MHA) that allows Indian non-profit organizations to receive donations or contributions from foreign sources.

Once an organization is registered under FCRA:

• It is legally entitled to accept foreign donations for its religious, social, cultural, charitable, educational, or benevolent activities.

• It must have strict compliance with the accounting, auditing, and reporting standards as mandated by the government.

• It has a 5-year validity for which it is required to be renewed after.

Types of FCRA Approval

There are two ways in which an Indian company can receive foreign contributions legally:

1. FCRA Registration

It is suitable for successful organizations that:

• Have been operating for a minimum of 3 years.
• Maintain a well-documented history of work in their area.
• Have invested ₹15 lakh or more of their own funds in their main business during the past 3 years.

2. FCRA Prior Permission

This is for newly registered NGOs or those ineligible for full registration but would wish to:

• Obtain a single contribution from a specific foreign contributor.
• Use the funds for a specific program or project.

This is donor-specific and project-specific permission, not permanent registration.

Who Needs FCRA Registration

Any Indian organization willing to receive foreign funds has to apply for FCRA registration. They are:

• NGOs (Non-Governmental Organizations)

• Charitable Trusts

• Registered Societies

• Section 8 Companies (not-for-profit companies registered under the Companies Act)

• Schools or religious institutions involved in public welfare

Even if an Indian organization gets a $10 donation from a foreigner, it is foreign contribution and needs FCRA clearance.

FCRA Registration Eligibility Criteria

To be qualified for FCRA Registration, an organization must:

• Be registered under Indian law as a Trust, Society, or Section 8 Company.

• Be in active service for at least 3 years.

• Have invested a minimum of ₹15,00,000 during the last 3 financial years on its charitable activities (excluding administrative expenses).

• Should have a spotless record, with no history of political or anti-national activities.

• Submit audited financial statements and activity reports for the last 3 years.

• Be registered on the NGO Darpan Portal of NITI Aayog.

Documents Required for FCRA Registration

Certain documents required for FCRA applications are provided as follows:

1. Certificate of Registration – Trust Deed, Society Registration Certificate, or Incorporation Certificate (in case of Section 8 Company).

2. MOA & Rules – Copy of Memorandum of Association and Bye-laws or Trust Deed.

3. PAN Card of the Organisation

4. Aadhaar and PAN of all the key functionaries – President, Secretary, Treasurer, and Board Members.

5. Audited Financial Statements – Balance Sheets, Income & Expenditure for the last 3 financial years.

6. Activity Reports – Documents of philanthropic activities, e.g., pictures, impact reports, media coverage.

7. DARPAN ID – Compulsory registration on NGO-DARPAN portal.

8. Board Resolution – Resolution of the governing body approving the application.

9. SBI Account Details – SBI-authorized bank account at SBI, Sansad Marg, New Delhi.

All the documents should be scanned and auto-attested prior to upload.

Step-by-Step Process for FCRA Registration – How to Apply

Step 1: NGO Darpan Registration

Go to ngodarpan.gov.in and register your organisation to obtain a DARPAN ID.

Step 2: Log in on FCRA Portal

Visit https://fcraonline.nic.in, make your user account, and choose the proper application form.

Step 3: Fill out Form FC-3A (for registration) or FC-3B (for advance permission)

Provide organizational history, office bearers, registration information, and activity history.

Step 4: Upload Documents

Upload all necessary documents in PDF format with original signatures.

Step 5: Pay the Application Fee

• ₹10,000 for FCRA Registration
• ₹5,000 as Advance Permission

Step 6: Submit and Track Application

When you submit, your application will be screened by the MHA. Background checks can be conducted by local authorities.

Opening the SBI FCRA Bank Account (Compulsory)

As per the FCRA Amendment Rules 2020, you are required to:

• Open a single particular FCRA bank account in SBI, Sansad Marg, New Delhi.
• All the overseas funds must be routed only via this account.
• You then send the amount to utilization accounts in other branches.

Funds received in other accounts will be treated as a violation.

Legality of FCRA and FCRA Renewal

• FCRA registration lasts for 5 years.
• Renewal must be performed 6 months before expiration on Form FC-3C.
• Renewal is not required; otherwise, automatic cancellation occurs.

Even though you have not received any foreign funds throughout the period of validity, you will need to request renewal.

Post-Registration Compliance for FCRA

After you get FCRA registration, compliance is really crucial. Some requirements are the following:

• Submit Annual Return (Form FC-4) with audited accounts on or before 31st December every year.

• Quarterly reports on your website for all foreign funds received.

• Maintain foreign contributions in a distinct book of accounts.

• Administrative expenses should not exceed 20 percent of foreign funds.

• Notify any change in principal members, address, or activities within 15 days on Form FC-6.

Non-compliance can attract heavy penalties or revocation of the registration.

Key Prohibitions Under FCRA

• There is no foreign contribution transfer to any unregistered NGO.

• No expenditure on purposes not mentioned in your goal.

• No political leanings or involvement.

• Funds should not be used for personal enrichment, luxury, or speculative ends.

FCRA Amendment Act 2020 – Key Amendments

The government made some significant amendments to the FCRA law in 2020 to boost transparency:

• Compulsory SBI Account in Delhi: Foreign funds should be received through SBI, Sansad Marg.

• Administrative Expense Cap: 20% capped (down from 50%).

• Ban on sub-granting: Foreign monies cannot be passed on to another NGO.

• Aadhaar for All Officials: All key functionaries must submit Aadhaar as KYC.

Suspension and Cancellation Provisions: The MHA can suspend the registration with or without notice in certain cases.

Why FCRA Registration is Important for NGOs

• Accept foreign funds legally for schemes of community development.

• Enhance your NGO’s credibility and donor confidence.

• Eligibility to apply for funding from international organizations such as UNICEF, WHO, Gates Foundation, etc. as well.

• Improved chances of cooperation with global agencies.

Most Prevalent NGO Blunders

• Provision of false documents along with incomplete applications.

• Default in filing annual returns.

• Not updating changes in board members or address.

• Combining internal and foreign capital.

• Failure to renew FCRA registration on time.

These errors may result in cancellation of registration or a fine of up to ₹1,00,000.

How Legal Dalal Can Assist You with FCRA

We at Legal Dalal provide expert NGO compliance and full-cycle support for:

• FCRA Registration and Advance Permission

• Support with Darpan ID and SBI FCRA account

• FCRA amendment and renewal services

• Preparation of FC-4 returns and audit support

• Professional legal counsel and compliance monitoring

We make processing easy for you so that your NGO can continue to operate while we do the paperwork.

FCRA registration is not just legal—it’s the key to earning trust and money from the entire world. For any NGO or nonprofit organization that wants to expand its reach and give back more to society through foreign contributions, FCRA registration is the beginning of credibility and legitimacy. 

With involved paperwork, stringent examination, and ever-evolving compliance guidelines, expert assistance is always advised. 

Let Legal Dalal walk you through easy FCRA registration and complete legal compliance. Call today and ensure your foreign funding legally and with confidence.