Which License is Required to Start an NGO

• Home
• /
• Knowledge Base
• /
• Post
• /
• Business
• /
• Which License is Required to Start an NGO

Which License is Required to Start an NGO

A Non-Governmental Organization is a not-for-profit entity that focuses on social welfare, humanitarian work or other goals that benefit society. It operates independently of government control. While independent, an NGO’s objectives can align with government priorities like education or women empowerment. 

If you are interested in starting your own NGO in India, you must be wondering which license is required to start it. In this blog post, we shall explain this.

Why Start an NGO in India?

By starting an NGO, you can contribute meaningfully to social change, address pressing issues in your community and create a lasting impact. Apart from this, you can access various government schemes, tax exemptions and funding opportunities to support your cause. In the eyes of the public, NGOs enjoy credibility, which can help in mobilizing volunteers, forming partnerships with corporations under CSR (Corporate Social Responsibility) and gaining media visibility. 

That’s not all. Running an NGO also allows you to build a professional network, develop leadership skills as well as influence public policy. In a diverse and developing country like India, the NGOs play an important role in empowering underserved populations.

Licenses and Permits Required to Start NGO

The following licenses and permits are required to start an NGO in India:

1. Trust/Society/Section 8 Company Registration

In India, a Non Governmental Organization can be set up as a trust, society or section 8 company:-

Trust Registration

• Suitable for: A trust is ideal if you want to open a charitable/religious organization to provide relief to the poor, education, medical assistance or partake in other social welfare activities. 

• Law & Registering Authority: Trusts are governed under the Indian Trusts Act 1882. They must be registered with the sub-Registrar of the local area where they are set up.

• Necessary Documents: Documents required to register a trust in India include:

• Trust Deed that outline objectives, trustees and powers

• Identity proof of settlor and trustees (like Aadhaar, PAN, etc.)

• Passport-sized photos of trustees

• Proof of registered office address (like electricity bill, rent agreement, NOC from landlord)

• Stamp paper

Society Registration

• Suitable for: A society is suitable for managing educational, charitable, scientific, literary or religious institutions that involve a group of individuals working together.

• Law & Registering Authority: Societies in India are registered under the Societies Registration Act 1860. They are registered with state-level Registrar of Societies.

• Necessary Documents: The documents required for registering a society are:

• Memorandum of Association (MOA)

• ID proofs of all founding members (minimum 7 members necessary)

• Passport-sized photographs

• Address proof of the registered office

• NOC from the property owner

Section 8 Company Registration

• Suitable for: A section 8 company is ideal for an NGO wanting a formal structure and aiming for corporate/international funding. It has the highest level of legal recognition when compared with other models. Large donors and grant agencies often prefer Section 8 company model. 

• Law and Registering Authority: Section 8 companies are governed by the Companies Act 2013. The Registrar of Companies (RoC), Ministry of Corporate Affairs (MCA), is responsible for registering section 8 companies in India.

• Necessary Documents: The following documents are necessary for section 8 company registration:

• PAN and Aadhaar of directors

• Passport-size photos of directors

• Digital Signature Certificate of directors

• Director Identification Number (DIN)

• Memorandum of Association (MOA) and Articles of Association (AOA)

• Proof of registered office address

• Declaration of non-profit objectives

• Consent/affidavit from directors

2. NGO Darpan Registration

NGO darpan registration is a voluntary registration. However, it is recommended for NGOs to apply for this registration as it offers increased transparency, access to government grants/schemes, eligibility for CSR funding and enhanced trust in the eyes of donors and stakeholders.

Documents Required for Darpan Registration

The following documents are required for Darpan Registration:

• Certificate of Registration

• Registration Number, Date of Registration and the Act under which the Organization has been registered

• PAN Card of the Organization

• PAN Card & Aadhar Card of at least 3 Board Members

• Aadhar Card of all Members

• Details of the Organization’s achievements

• Details of Chief Functionary and Chairman of Organization

• List of Members of the Organization

• Contact Details of Members, such as Email IDs and Mobile Numbers

• Details of Funding Sources

• Duly Certified Copy of Trust Deed (in case of trust/society)

• Duly Certified Copy of MOA (in case of section 8 company)

• Details of Activities undertaken by entity

• Proposed Activities’ Details.

3. FCRA License

If an NGO wants to receive donations from abroad, it is necessary to secure FCRA registration. An NGO that is FCRA-registered is authorized to utilize foreign contributions for the purpose for which it has been registered/granted prior permission under Foreign Contribution Regulation Act 2010.

Documents Required for FCRA Registration

The following documents are required for FCRA Registration:

• Registration Certificate of Association

• Memorandum of Association/Trust deed

• Activity Report for the last three years

• Last 3 years’ audited statement of accounts

• Chief Functionary signature

• Seal of the Association

• Associations has to upload affidavit of each key functionary

Other Requirements

Here are other requirements you need to fulfill to start an NGO in India:

1. Permanent Account Number (PAN) 

A Permanent Account Number (PAN) card is mandatory for all the Non Governmental Organizations in India regardless of whether they are registered as a trust, society or section 8 company.

PAN is essential for financial and tax-related transactions. It serves as a unique identity for an NGO. It is important to note that the PAN must be in the NGO's name and not in the individual trustee or founder’s name.

2. Bank Account

Once you obtain a PAN for your NGO, you must open a dedicated bank account in the NGO’s name. This is extremely important for receiving donations, grants and conducting day-to-day financial transactions.

The bank might require documents like registration certificate, PAN, MOA/trust deed and KYC documents of authorized signature to open a bank account in the name of the NGO. A separate FCRA-designated bank account must be set up with a bank branch for accepting FCRA donations.

Conclusion

To start an NGO in India, you need to register it as a Trust, Society or Section 8 Company. If you want to access government grants and schemes’ benefits, you must also get an NGO darpan certificate. For accepting foreign donations, you must get FCRA registration for your NGO. Other essential requirements include securing a PAN card and opening a dedicated bank account. With the right licenses and structure in place, you can operate your NGO in a smooth manner. To start an NGO, connect with Registrationwala. We can help you to choose the right model for your organization and assist you throughout the registration process!

• 1090 views