Foreign Contribution Regulation Act (FCRA)

Recent changes?

registrations now activity + geography based
- $⟹$ orgs must declare specific approved states / UT & activity
No proselytisation
orgs must utilize min 10L in foreign funds over 2 financial year to demonstrate active operations
if an org’s FCRA registration cancelled / expires, then contributions vent in govt appt authority
- provision for permanent takeover by govt
receiving orgs prohibited from producing / broadcasting news, current affairs

0.4% MDR above Rs.2K

UPI was developed as zero MDR to encourage adoption
however, costs are still borne by govt on:
- txn processing
- settlement
- cybersecurity
- infrastructure
- network maintainence
Taxing UPI txn may disproportionately affect small merchant / low margin businesses which will encourage return to cash
$∴$ consider not just revenue but an inclusive model for DPI for payments
way forward:
- MDR framework should be targeted, proportionate, evidence based
- safeguard small merchant and low value txn
- explore differential pricing, subsidies for smaller txn
- promote transparent, predictable, stable policy for cost sharing among banks, fintech & other stakeholders
- expand value added services for monetization

86% of all non cash digital txn
55Cr active users
PhonePe & Google pay process 80% of all UPI txn volumes & 83% by value
- SBI processes only 0.1% by volume