The Foreign Contribution (Regulation) Act, 2010, together with the Foreign Contribution (Regulation) Rules, 2011 and the significant FCRA (Amendment) Act, 2020, governs how associations in India may accept and use foreign contributions. Administered by the Ministry of Home Affairs (MHA), the law's purpose is to ensure that foreign funding does not prejudice national interest. Any NGO, trust, society or Section 8 company that wishes to receive donations, grants or contributions from a foreign source must first obtain clearance under the Act.
What counts as foreign contribution
A "foreign contribution" is any donation, delivery or transfer of currency, articles or securities made by a foreign source. Money received from a resident Indian's own earnings abroad, or from a relative (subject to reporting above the prescribed limit), is not treated as foreign contribution. Government bodies, and funds received as a fee for services or against exports, also fall outside the definition. If your organisation intends to receive foreign funds for definite social, educational, religious, economic or cultural programmes, FCRA clearance is mandatory before the first rupee is credited.
Registration versus prior permission
- Normal registration (Form FC-3A): Suited to established organisations that have been operating for at least three years and have spent a minimum of ₹15 lakh on their core objectives over the last three financial years (administrative costs excluded).
- Prior permission (Form FC-3B): Designed for newer organisations or one-off projects. It ties a specific sum to a specific foreign donor for a named activity, and requires a commitment letter from that donor.
Forms, fees and deadlines
| Purpose | Form | Government fee |
|---|---|---|
| Fresh registration | FC-3A | ₹10,000 |
| Prior permission | FC-3B | ₹5,000 |
| Renewal | FC-3C | ₹5,000 |
| Annual return | FC-4 | Nil |
| Intimation of changes | FC-6 | Nil |
All filings are made online at fcraonline.nic.in, and the Aadhaar of every office bearer is required.
Ongoing compliance obligations
- FCRA Account at SBI, New Delhi Main Branch: Since the 2020 amendment, every recipient must receive foreign contribution only into a designated FCRA account at the State Bank of India, New Delhi Main Branch. Funds may later be moved to a utilisation account with any scheduled bank.
- 20% cap on administrative expenses: No more than 20% of the foreign contribution received in a financial year may be spent on administration (reduced from 50% by the 2020 amendment).
- No sub-granting: Foreign contribution cannot be transferred to any other person or organisation, even one that itself holds FCRA registration.
- Annual return in Form FC-4 must be filed by 31 December for the preceding financial year, with audited accounts and a chartered accountant's certificate. A NIL return is required even in a year with no receipts.
- Changes to name, address, bank details or key members must be intimated in Form FC-6 within the prescribed period.
Validity, renewal and cancellation
Registration remains valid for five years. An application for renewal in Form FC-3C should be filed at least six months before expiry; letting it lapse blocks fresh receipts until reinstated. The MHA can suspend or cancel registration for violations such as diversion of funds, failure to file returns, or activities against public interest. A cancelled organisation cannot re-apply for three years, so disciplined record-keeping and timely filings are the surest way to protect uninterrupted access to foreign funding.