We have received following query from Mr. Priyamvada Singh. Kindly give your responses.
- We have our trust registered in Bangalore Karnataka under the Trust Act since Dec. 2003 and having FCRA certification (permanent) since 2009. Our FCRA bank account is in Bangalore with HDFC bank; we are having our programme operations in several states of India.
- We want to know whether the Trust can shift Trust’s FCRA bank account to the other city (or Delhi) to manage its FCRA grants and operations from a better suited place? Kindly note that we have existing FCRA grants being revived /managed thru this bank account.
- If such shifting of FCRA bank a/c is permitted from one city to another under the FCRA Act, then what are the processes and formalities one need to under go for such shifting of the FCRA bank account? Kindly list all the steps and the requirements to be in compliance with the FCRA act obligations.
- How much time this process takes?
Thanks and Regards
Priyamvada Singh, Ph.D
Development Consultant,
Dear Sir,
Greetings !
We can open only one FCRA Bank account, but for other city we may open one or more accounts for utilizing the foreign contribution as per Foreign contribution (Regulation) Act, 2010.
After open separate Bank account & received account number, we have to inform Ministry of Home affairs.
But such type of case we are also suffering for another sub account open for project, our Standard Chartered Bank (10,Sansad Marg, New Delhi-110001) is taking very long time.
Eight months back all papers formalities have been submitted timely but from their side not yet open(another sub-account). So many visits have done, they told us that KYC formalities is going on, another no any region or response from their side.
Funding agency wants separate bank account & denied to next installment.
Kindly suggest us what will have to do ?.
With regards,
Sarita Sharma,
Sr. Manager Accounts,
MOBILE CRECHES
DIZ Area, Raja Bazaar, Sector IV,
New Delhi 110 001,
India
Dear Saritaji,
Greetings from Hyderabad!
I agree with you that we may open as many utilizations accounts as we want but the designated account is only one. Coming to your problem, it is a bank specific problem. In that case also I do not see any reason why an account cannot be opened for 8 months. It is a ridiculous argument for the bank to make that KYC formalities are being looked into. You can also open a utilization account in some other bank. It is not necessary that the utilization account and the main FC account should be in the same bank.
So far as the funding agencies are concerned, you will have to place a strong justification for the same and submit your correspondence you had with Standard Chartered Bank. Also, the instalment will come to the main account and I see no reason for not releasing the instalment.
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
Dear Sarita,
As Soma below suggests, you do not need to open a Utilization Bank Account with same bankers as the designated banker. Utilization account can be opened with any banker whatsoever. So you could try another banker in case your present banker is not cooperating.
rgds
subhash mittal
Dear Ms Priyamvada Singh,
I feel responses on a query raised by you have been quite good. I can summarise it by stating that while FCRA allows changing of Bank account. However operationally the process is not an easy one, particularly if that involves change in the State. So my suggestion is that having a new designated FCRA account should be considered only after you have exhausted all other options.
warm rgds
many thanks, we appreciate all the responses and your attention and support on the matter. Kind Regards. Priyamvada
Dear Mr. Singh,
Greetings from Hyderabad!
I have seen you queries and would like to respond in the following manner:
We have our trust registered in Bangalore Karnataka under the Trust Act since Dec. 2003 and having FCRA certification (permanent) since 2009. Our FCRA bank account is in Bangalore with HDFC bank; we are having our programme operations in several states of India.
I should not be actually commenting on the issue but I see no reason why there should be problem in operating an account from Bangalore as the same problems would be encountered if you have an account in any other place. Since you have operation in other parts of India, the FC utilization accounts can be opened and funds can be transferred from the FC designated accounts to the utilization account. This may partially solve your problems.
We want to know whether the Trust can shift Trust’s FCRA bank account to the other city (or Delhi) to manage its FCRA grants and operations from a better suited place? Kindly note that we have existing FCRA grants being revived /managed thru this bank account.
A Trust can shift its FCRA designated account but you will have to pass a Board resolution, give reasons for such a change, open a account and provide the details along with the application etc. The other details will be provided in the “Change in Bank/Bank Account” format. When the account is change, you may have to inform you donors about such change very well in advance so that funds do not go to that account as an organization cannot have more than one FC designated account. Even if you were to change the account, it is advisable to close the previous account to avoid any confusion either within the organization or with any external stakeholder.
If such shifting of FCRA bank a/c is permitted from one city to another under the FCRA Act, then what are the processes and formalities one need to under go for such shifting of the FCRA bank account? Kindly list all the steps and the requirements to be in compliance with the FCRA act obligations.
The shifting of the bank account is permitted under the FCRA and as mentioned in the previous point, all such formalities will have to be complied with. The process may take atleast 3 months as you cannot operate the account till the time the approval letter is sent by the FCRA division.
I hope your queries have been addressed and I would also request other to kindly respond to the queries.
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
As per the FCRA rule we can receive the money only one bank account and utilization purpose you can open so many account ,after opening the account you have intimate with 15 days to Ministry Home affairs.
Your organization was registered in Bangalore and you are working all over India all other places who can open a utilization account .In the Bangalore account you can receive all the donor agencies money ,you cannot receive the money in utilizing money from donor’s.
In this connection, as per new FCRA guideline you will be allowed to open FCRA sub bank accounts at different places for implementation of your programme. Send an intimation of the new bank account to MHA. After that you can transfer funds to newly opened bank account from your registered / designated FC bank account for implementation of the programme activities.