In September 2020, the bill to amend the foreign contribution (Regulation) Act 2010 was introduced in the parliament. The main aim of this bill was to restrict the misuse of foreign fundings and minimize any potential threats to the internal security of India.

In this article, we will talk about what the FCRA act is. And important provisions of FCRA amendment 2020.

Things to Know about FCRA for  UPSC

The foreign contribution (regulation) amendment Bill, 2010 was amended by the parliament. Here is the brief introduction to the provision of the amendment:

# A new amendment required that any organization that wants to register itself under FCRA has to have existed for at least three years.

# The applicant organization should have spent at least Rs. 15 lacs on its core activities during the last three financial years for the benefit of society.

# Officials of the seeking NGO should submit a commitment letter with the FCRA from the donor indicating the amount of foreign contribution and the purpose why it is given.

# Also any NGO or individual making an application to receive foreign funds should do it in an FCRA account.

Also Read: NFT Meaning: What is Important About Non-Fungible Tokens?

What is FCRA?

FCRA stands for foreign contribution regulation Act. This is an act of Parliament that was enacted in 1976 and amended in 2010. The main purpose of this act is to regulate foreign donations and ensure that it has nothing to do with threats to internal security.

This rule applies to all individuals, organizations, associations, groups, or NGOs that are receiving or are expecting to receive foreign donations.

Also Read: What is the G20 Summit 2021? Get All the Notes on India G20 Summit for UPSC

FCRA 1976

On 31st March 1976, this Act was enacted by the government. The main aim of this act was to regulate the utilization of foreign contributions by individuals or associations. Ensure that there is no potential threat to their internal security and also to maintain the sovereignty of India. This act maintains strict control over the organization and associations that were receiving foreign funding.

FCRA Contribution (Regulation) Act 2010

This Act was enacted by the government to regulate the foreign funding of the person or organization in India. This bill included that any individual or organization can accept the foreign contribution or donation without the permission of the ministry of home affairs but under certain conditions.

Also, the monetary limit for such contributions was set as Rs 25,000. Under this, organizations are required to register themselves every 5 years.

Prominent Feature of the FCRA 2010

# The home ministry can cancel the registration of any NGO if it believes that this organization is political and not neutral.

# The registration certificate to any organization was only valid for 5 years and after the competition of five years, they had to register themselves again.

# This is also required that the person of the organization deposits their foreign contribution to a separate bank account with the government.

# Every Bank that has a foreign contribution bank account starts to report to the authority about the details.

Also Read: What is Chipko and Appiko Movement? A Step to Save Our Mother Nature

FCRA Renewal Amendment 2020

The foreign contribution (regulation) amendment, 2020 was introduced in Lok Sabha. The bill amended the Foreign Contribution (Regulation) Act, 2010. The bill was supposed to amend the associated Act. The act is related to the acceptance of foreign contributions by individuals, organizations, and associations.

Prominent Provisions Related to Foreign Contribution (Regulation) Act

# Under this act, certain persons were prohibited from accepting foreign contributions. This includes election candidates, editor and publisher of the newspaper, judges, government servants, legislature members, political parties, and many more.

# The bill required that this foreign contribution cannot be transferred to another person. Only those people can accept transfers of foreign contributions that are registered under FCRA.

# This implies that any person can accept foreign contributions if they have obtained the certificate of registration from the central government or are not registered but have the permission of the government.

Any person who is seeking registration for permission to receive foreign contributions must submit an application to the central government in the prescribed rules. Moreover, they have to provide Aadhaar number of all official directors and key functionaries.

# Moreover, this act implies that a person should only accept foreign contributions in a single branch of a scheduled bank. We can open more than one account for the utilization of the contribution but they can only receive foreign contributions in the specified Bank. This bank account will be designated as an FCRA account. Moreover, the person can not submit any other refund in that Bank account. To transfer the foreign contribution for its utilization they have to open another FCRA account.

# Under this bill every person who has been registered in the certificate of registration must renew their certificate after the completion of 5 years.

# Under this act, a person can only use 20% of the foreign contribution to meet their administration expenses.

# If someone is found to violate any of the provisions of the act the authorities can freeze the organization’s remaining foreign funds.

Who is Affected by the FCRA Amendment 2020?

All the organizations regulated under the FCRA act are affected by this amendment. Moreover, this amendment applies to every non-profit that is operating in India but receiving foreign funding to complete the missions.

Who Can Accept Foreign Contribution?

Any non-profit organization registered under the central government or has received certification from FCRA can accept foreign contributions for the achievement of their purpose. For instance social, educational, religious, economic, or cultural purposes.

Who Cannot Accept Foreign Contribution?

The act also determines who cannot accept foreign donations. For instance, members of the legislature, political parties, government officials, judges, media persons, and public servants cannot accept any kind of foreign contribution.

What was the Need for This Amendment?

The main objective of this act was to control the misuse of foreign money for religious conversion. Other important objectives are to prevent the loss of GDP, account for transparency and accountability of the organization receiving foreign contributions, and to regulate NGOs.

Issues Associated with the FCRA

# The bill is expected to impact the livelihood of the workers associated with NGOs and affect their performance.

# This act would put excessive regulation over the Civil society organizations and educational research institutions.

# This act is incompatible with International Law as the United Nations Human rights council says that no law can restrict the activities of a person in the origin of funding.

# This act would restrict the operation of the NGO and would severely discourage their social work.

# This act would reduce foreign investments.

# This act is also against India’s international legal applications and the constitutional provision that states that it accepts the right to freedom of different associations and expression.

Also Read: List of Tribes in India: How Many Tribes are there in India?


This act has raised controversy between the government and several NGOs working in India. For more such informative articles and UPSC-related articles, you can visit UPSC Pathshala. This website is the one-stop destination for all UPSC aspirants. Also, it is a perfect destination for anyone who is preparing for any prominent government job.

Content Protection by
What is FCRA? Checkout this Important Topic for UPSC Preparation 2021
Article Name
What is FCRA? Checkout this Important Topic for UPSC Preparation 2021
Are you preparing for UPSC? If yes, you have to pay attention to current affairs equally. Here in this article, you will find a recent amendment in FCRA, 2020. Click to know more.
Publisher Name
UPSC Pathshala
Publisher Logo

About the Author

Deeksha Paswan

Deeksha is a content writer at Ufaber EduTech. She writes well-researched, SEO-friendly articles to satisfy the reader's search intent. Until now, she has written over 300+ articles for various websites on different genres. She goes by the motto “flowing like a river, rather than an immobile pond.” She is a headstrong girl who follows her heart. Apart from this, she is a nature lover, bibliophile, dancer, artist and skilled cook. She is set on her journey to unveil the mysteries of life.

View All Articles