FCRA Registration

The Foreign Contribution (Regulation) Act, 2010 read with the FCRA Rules 2011 and the heavily amended FCRA (Amendment) Act 2020, governs every rupee of foreign contribution received by Indian non-profits — Section 8 companies, charitable trusts, and registered societies. Without an FCRA registration or specific prior permission from the Ministry of Home Affairs (MHA), an Indian non-profit cannot lawfully accept any foreign contribution — whether in cash, kind, securities, services, or article — and any unauthorised receipt is a criminal offence under Section 35 of the FCRA, with the entity's bank accounts liable to be frozen and the receipt itself treated as proceeds liable to confiscation.

By 2026 the regime is significantly tighter than pre-2020. Every FCRA-registered entity must operate the FCRA Designated Bank Account exclusively at the State Bank of India, New Delhi Main Branch (SBI NDMB), with utilisation accounts allowed only at scheduled commercial banks. Sub-granting of foreign contribution to other NGOs is prohibited — whoever receives, must spend. Administrative expenses are capped at 20% of the total foreign contribution received in a financial year. Aadhaar of every key functionary is mandatory, and surrender, refusal of renewal, suspension and cancellation provisions have all been used aggressively. Registration validity is 5 years, with renewal applications mandatory in the 6 months before expiry.

The two routes are Registration (for entities with 3 years of existence and at least ₹15 lakh of charitable spend in the preceding 3 years) and Prior Permission (project-specific, donor-specific, suitable for newer entities or specific large donations from a known foreign source). Choosing the right route is the first design decision; the rest of the file follows from it.

FCRA Registration vs Prior Permission

• Registration (Section 11(1)):: For established entities (3-year track record, ₹15 lakh charitable spend); valid 5 years; allows receipt from multiple donors for stated cultural / economic / educational / religious / social objects; renewable. The default route for serious non-profits.

• Prior Permission (Section 11(2)):: Donor-specific and project-specific; faster suited where a specific foreign donation is in pipeline; expires once the project is complete or the funds exhausted. Useful for newer entities, time-sensitive projects, or one-off large grants.

The FCRA Operating Discipline (Post-2020 Reality)

• FCRA Designated Account at SBI NDMB:: All foreign contribution must first land in the FCRA Designated Account at the State Bank of India, New Delhi Main Branch — no other branch, no other bank. Utilisation accounts at any scheduled commercial bank are then permitted, but only after first credit at SBI NDMB.

• No Sub-Granting:: The entity that receives the foreign contribution must utilise it itself; transfer to any other entity (even another FCRA-registered entity) is prohibited under Section 7. This single change in 2020 has reshaped the Indian non-profit ecosystem.

• Administrative Expense Cap:: Administrative expenses (defined under Rule 5) are capped at 20% of foreign contribution received in a financial year — utilisation budgets must be designed accordingly.

• Annual Returns:: Form FC-4 with audited statements is filed annually within 9 months of financial year-end, even for years of nil receipt. Quarterly receipts are auto-displayed on FCRA portal.

• Renewal & Suspension Risks:: Renewal applications must be filed 6 months before expiry; failure to renew results in suspension; suspension and refusal of renewal have been actively used by MHA in recent years.

FCRA Forms — What Is Filed When

FC-1: Intimation of foreign contribution by way of gift from relatives. FC-3A: Application for FCRA Registration. FC-3B: Application for Prior Permission. FC-3C: Renewal application. FC-4: Annual return. FC-6: Intimation of changes (key functionaries, address, bank, designation, name). Each form has its own timeline, supporting-document pack and signatory framework — and a missed FC-6 (e.g., a director change not intimated within 15 days) is a frequent ground for show-cause and suspension.