Opening of FCRA Bank Account

9 Responses to Opening of FCRA Bank Account

1. Subhash Mittal says:

   April 20, 2013 at 2:49 pm

   Dear Thiyagarajan, I would just like to clarify that basically there are two type of FCRA accounts. Designated Account ~ this is the main FCRA account and all FCRA funds must be deposited in this account only.

   Sub Account (or a Utilisation account or Expense Account as you have called it). This account is meant only for utilising the funds and no FCRA funds can be deposited in this. I would like to further clarify that sub account is for convenience only. You can always undertake expense from your designated account. However in case you would like to transfer funds to another account (say where project is located in another district), then you can use this account for utilising the transfers made to these accounts from the main designated account.

   rgds
   • Thiyagarajan says:

     April 23, 2013 at 7:11 am

     Dear Sir,

     Your clarification is very detailed. I understood that. thank you so much for your reply.
2. Gopi David, VIKASAM, Hyderabad. says:

   April 17, 2013 at 12:09 pm

   As per FCRA Rules NGO have to open a Bank account for the purpose to receive foreign funds (donations / grants) on it’s own choice of scheduled bank. This information to be filled in prescribed application for grant of FCRA Certificate.

   FCRA accounts are of two categories;
   1). FCRA main account to receive funds transfer from foreign source, always your society/trust must receive foreign funds only to this designated account. Then later it can be transferred to different Sub-accounts if needed.

   2). FCRA Project/ Donor wise sub-accounts. You can open FCRA-Sub.accounts for each funding source/project if needed. But all these has to be informed to MHA -FCRA department with in 15 days and get approval.

   Here i am pasting the related portion from FCRA Act-2010, Chapter-IV, Section-17(1). for your reference.

   17.(1) Every person who has been granted a certificate or given prior permission under section 12 shall receive foreign contribution in a single account only through such one of the branches of a bank as he may specify in his application for grant of certificate:

   Provided that such person may open one or more accounts in one or more banks for utilising the foreign contribution received by him: Provided further that no funds other than foreign contribution shall be received or deposited in such account or accounts.Cancellation of certificate. Management of foreign contribution of person whose certificate has been cancelled.Renewal of certificate. Foreign contribution through scheduled bank.
   12 (2) Every bank or authorised person in foreign exchange shall report to such authority
   as may be specified —
   (a) prescribed amount of foreign remittance;
   (b) the source and manner in which the foreign remittance was received; and
   (c) other particulars,
   in such form and manner as may be prescribed.

   Thanking you.
   • Thiyagarajan says:

     April 23, 2013 at 7:15 am

     Dear Sir, Thank you so much such a details clarification and explained. I understood that.
3. FBVANAJA says:

   April 17, 2013 at 10:49 am

   Sir,

   Can an existing bank account be used as an utilization account ?
   • B V Soma Sastry says:

     April 20, 2013 at 11:06 am

     Dear Vanaja,

     Greetings from Hyderabad!

     On you query “Can we use an existing bank account for FC utilization”:

     1. The provision of opening utilization accounts was not there in the previous FCRA 1976. The provision was incorporated in the FCRA 2010 Rules 2011

     2. The bank account that has been already existing should not have been opened prior to May 01, 2011.

     3. If already certain transaction of NFC have happened in the existing account, then it would amount to mixing of FC and NFC funds.

     I hope there is clarity on the issue.

     Thanks and regards,
     _____________________________________
     B V Soma Sastry
     Director – Finance and Admin
     Centre for World Solidarity
     12-13-438, Street No. 1, Tarnaka
     Secunderabad 500 017
     Andhra Pradesh
4. B V Soma Sastry says:

   April 17, 2013 at 7:12 am

   Dear Thiyagarajan,
   Greetings from Hyderabad!

   Kindly note the following:

   1. NPOs are free to open a FC utilization account in any bank of their choice with the due process i.e. getting the Board/GB approval etc. Prior approval of the FCRA division, MoHA is not needed for opening such account.

   2. Upon opening of such account, the organization should inform MoHA about that account within 15 days of such opening

   3. The organization is expected to retain a copy of the letter and the postal acknowledgment for filing purpose and any future reference

   4. The inward remittances from the donors should be only to the main FC designated bank account and in no case to the utilization account

   I hope this clarifies your doubt.

   Thanks and regards,
   _____________________________________
   B V Soma Sastry
   Director – Finance and Admin
   Centre for World Solidarity
   12-13-438, Street No. 1, Tarnaka
   Secunderabad 500 017
   Andhra Pradesh
   • Thiyagarajan says:

     April 17, 2013 at 8:59 am

     Thank you so much for clarification,
5. Jagdeep Kakkar says:

   April 17, 2013 at 5:47 am

   Dear Sir,
   Yes, we need to inform to Home Ministry for opening of sub FCRA Account after opening the accounts , if FC grant is being transferred to its UNITS for the expenses for running of the programs of the NGO. We wish to know how the FC grant is being transferred to NGO’s units? Thanks and regards

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