What changed
RBI issued new guidelines under Section 36(1)(a) of the Banking Regulation Act, 1949, mandating compliance with the Foreign Contribution (Regulation) Act, 2010 and its Rules, 2011. The earlier Foreign Contribution (Regulation) Act, 1976 stands repealed. The circular includes an annex with salient features of the new Act.
What it means for you
RRBs, StCBs, and DCCBs must now align their operations with the updated FCRA 2010 framework, which governs foreign contributions. This may require changes in reporting, documentation, and due diligence processes. Banks should treat the circular as a guide and refer to the full Act and Rules for detailed compliance, seeking legal advice when uncertain.
What you must do
- Review the attached guidelines and annex on FCRA 2010 and ensure your bank's policies are updated accordingly.
- Train relevant staff on the new Act's provisions, especially regarding foreign contribution acceptance and reporting.
- Acknowledge receipt of this circular to your respective RBI Regional Office.
- Consult legal experts if any doubts arise about the Act or Rules.
Who it affects
Regional Rural Banks (RRBs), State Co-operative Banks (StCBs), District Central Co-operative Banks (DCCBs)
What is the key change introduced by this circular?
RBI has issued guidelines under the Banking Regulation Act, 1949, requiring RRBs, StCBs, and DCCBs to comply with the new Foreign Contribution (Regulation) Act, 2010, which replaces the 1976 Act.
Do we need to follow the old FCRA 1976 now?
No, the circular states that the 1976 Act stands repealed with the coming into force of the 2010 Act. You must comply with the new Act and its Rules.
What should we do if we are unsure about any provision?
The circular advises banks to refer to the full text of the Act and Rules, and if necessary, seek proper legal advice.