Govt tightens noose on NGOs; asks them open core accounts in public banks

Registration of more than 10,000 NGOs have been cancelled over the last three years

Tightening the rules for NGOs (Non-governmental organisation), the Home Ministry has asked as many as 5,845 organisations to open their accounts in banks having core banking facilities and furnish details for real-time access to security agencies in case of any discrepancy.

It is the latest in a series of steps taken by the NDA government aimed at checking "errant" NGOs, especially those receiving foreign funding.

Registration of more than 10,000 NGOs have been cancelled and more than 1,300 have been denied a renewal over the last three years for various violations.

The move came after it was detected that many NGOs have their bank accounts in cooperative banks or state government- owned apex banks or banks which do not have core banking facilities, official sources said.

In March, Business Standard had reported that as many as 11,319 NGOs were barred from receiving foreign funds as their Foreign Contribution Regulation Act (FCRA) licences had expired with effect from November 1, 2016 and registration of more than 14,000 NGOs was cancelled for violating the law.

As of now, there are around 24,000 active NGOs in the country as against 40,000 in 2014-15.

Also Read: UNHRC should call on India to stop targeting NGOs, says Human Rights Watch

In a communication, 3,768 NGOs have been told that their bank accounts are not available according to core banking format while 2,077 NGOs have been asked to furnish bank accounts details as no such data is available with the home ministry.

Last month, the Supreme Court had asked the centre to consider making a law to regulate NGOs, disbursal of funds to them and consequential proceedings on account of defaults and asked it to respond in eight weeks.

A bench headed by Chief Justice J S Khehar had said the existing regulations were not sufficient to regulate the NGOs across the country, the disbursal of funds and consequential defaults, Business Standard had reported. 

Also Read: NGOs need to register with NITI Aayog for grant-in-aid

The home ministry wants that all NGOs registered under the Foreign Contribution Regulation Act mandatorily have their accounts in either nationalised banks or in a few private banks which have core banking facilities.

Under core banking system, all the branches of the networked banks are interconnected. This would allow the security agencies to access the accounts of the NGOs on real time basis, the sources said.