The FCRA was enacted with the objective of creating a transparent mechanism for individuals and organizations through the E-governance of FCRA-related activities and discouraging any detrimental activities against national interest. In furtherance of this objective, the RBI, introduced FCRA-related transaction code in NEFT and RTGS Systems on 16th February vide notification RBI/2022-23/178. The present article shall discuss the details of the notification.
FCRA is an acronym for Foreign Contribution Regulation Act. It regulates the receipt of foreign contributions or aid from outside India to Indian territories; it is essential to ensure that such assistance doesn’t affect politics or any other situation in India. The compliance of this act is usually complex as it focuses on the genuineness of the donations. This law is enforced by the Ministry of Home Affairs, Government of India which has a separate section to ensure compliance with the Foreign Funding Registration.
The technical Details related to FCRA Transactions in NEFT and RTGS Systems are enumerated below –
Originating banks must select the following mandatory fields of NEFT / RTGS systems at the time of remitting foreign donations to the FCRA account at SBI:
Field | Type | Code to be used |
6305 (in N06 message) | NEFT | 41 |
PmtTpInf/CtgyPurp/Cd (in Pacs.008 message) | RTGS | FCRA |
Originating banks must pass on donor details in the following formats of ‘Sender to remitter information’ (field no. 7495) of NEFT and ‘RmtInf’ tag of RTGS:
System | Field / Tag | Code to be used | Transaction without Legal Entity Identifier (LEI) details | Transaction with LEI details |
NEFT | 6305 (in N06 message) | 41 | Field- 7495 line 1: Donor Address line 2: Donor Address line 3: Name of the Donor line 4: Purpose of the Remittance – Alphanumeric line 5: Country of the Donor – Alphabet line 6: Currency and Amount – Alphanumeric | Field- 7495 line 1: SL/20-digit sender LEI/ line 2: BL/20-digit beneficiary LEI/ line 3: Name of the Donor line 4: Purpose of the Remittance- Alphanumeric line 5: Country of the Donor-Alphabet line 6: Currency and Amount- Alphanumeric |
RTGS | PmtTpInf / CtgyPurp / Cd (in Pacs.008 message) | FCRA | Tag- RmtInf/Ustrd loop 1: Name of the donor loop 2: Donor Address loop 3: Purpose of the Remittance- Alphanumeric loop 4: Country of the Donor, currency, and Amount – Alphanumeric | Tag- RmtInf/Ustrd loop 1: /SL/20-digit sender LEI/ loop 2: /BL/20-digit beneficiary LEI/ loop 3: Purpose of the Remittance – Alphanumeric loop 4: Country of the Donor, currency, and Amount – Alphanumeric |
The Apex Bank has issued these instructions u/s 10 (2) r/w Section 18 of the Payment and Settlement Systems Act, 2007. The notification so issued can simply the receipt of foreign contributions and ensure the genuineness of the same due to the contributions being received from a safe, secure and trusted payment method like RTGS / NEFT
Also Read: Real-Time Gross Settlement System (RTGS)
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