How Does an NGO Get Funding in India?

A Non-Governmental Organisation (NGO) is a non-profit charitable organization. In India, NGOs are set up under section 8 of the Companies Act. They are regulated by the rules of the Companies Act, 2013. NGOs established as trusts or societies are governed by state governments. NGOs work to improve society and help people in need. Since NGOs are non-profit organizations, they need to raise funds to support their work. This article explains how NGOs in India can obtain funds.

Types of NGOs

Many international non-governmental organizations (NGOs) are made up of groups from different countries. Some examples include Amnesty International and Save the Children. In India, there are organizations like CRY, Care India, and Smile Foundation. The World Bank has identified two main types of NGOs. Advocacy NGOs work to promote specific causes. Operational NGOs focus on development projects. NGOs can also be grouped based on their goals and how they work.

The orientation-based NGOs are further classified as follows:

Service orientation: Service orientation NGOs run campaigns to advance health, family planning and education. 

Charitable orientation: A charitable orientation NGO is an endeavour with minimum involvement from the beneficiaries. It includes NGOs running campaigns to meet the requirements of the underprivileged. These campaigns provide food, clothing, medication, shelter, transportation, and education. 

Empowering orientation: Empowering orientation intends to help those in need. It understands the political, social, and economic elements affecting their life. It also aims to create awareness to control those circumstances.

Participatory orientation: Participatory orientation NGOs take up self-help projects. They involve residents who give resources, such as land,  money, labour, equipment and materials, in deploying a project

Ways to Raise Funds for NGOs

✅ Raising funds through events.

✅ Network fundraising.

✅ Personal solicitation.

✅ Online fundraising.

✅ Volunteering.

✅ Periodic donation through the adoption of a project.

✅ Raising money from young people and in schools.

✅ Donations in kind.

✅ Collections.

✅ Corporate partnerships.

✅ Product sales.

✅ Crowdfunding.

✅ Raising money from corporates under CSR.

✅ Raising money under government schemes.

✅ Fundraising from social media.

✅ Fundraising from abroad, in the case of NGOs holding FCRA (Foreign Contribution Regulation Act) certificate.

How are NGOs Funded in India?

NGOs are non-profit organizations that rely on various funding sources to cover their operating expenses. These funds are essential for supporting the NGO’s short-term and long-term goals. Therefore, fundraising activities are critical to the continued success of NGOs.

NGOs in India are funded by membership fees and, the sale of goods and services. They also receive grants from other charitable foundations, state governments, and municipal and private donors. However, many NGOs rely heavily on government subsidies and funds. This reliance can be controversial. These subsidies can promote political goals instead of national development.

NGOs can receive contributions from many sources, including for-profit corporations, private citizens, and non-profit foundations. They can also receive contributions from governments, including state, local, and foreign governments. As non-profit organizations, NGOs can offer services and goods and collect membership fees.

NGOs can also get financing through gifts and donations, especially from unofficial groups or private individuals. In addition, micro-enterprises, micro-insurance, and micro-finance are some non-traditional resources for NGO funding.

NGO DARPAN Portal

The Indian government has created an online portal, NGO DARPAN. The aim is to promote and create a healthy partnership between NGOs and the Government of India. The portal serves as an interface between NGOs and other government departments. It facilitates the exchange of crucial information between government agencies, volunteer organizations, and NGOs. NGOs can get vital information about government programs and funds by signing up on the NGO DARPAN portal.

The NGO DARPAN portal is an online resource that provides crucial information for NGOs. It facilitates the exchange of information between government agencies, volunteer organizations, and NGOs. NGOs can get vital information about government programs and funds by signing up on the NGO DARPAN portal.

The government mandated NGOs to complete the NGO DARPAN online registration as of December 2019. NGOs require an NGO certificate to qualify for FCRA registration and apply for additional government permissions. Below is the NGO DARPAN portal’s registration process:

☑ Visit the NGO DARPAN portal.

☑ Click on the ‘Login/Register’ button and click on the ‘Sign Up’ button.

☑ Enter the name of the NGO, mobile number, and email and click on the ‘Submit’ button.

☑ Enter the PAN of the NGO and password and submit it.

☑ After logging into the portal, enter the registration information. 

☑ Choose the company sector, enter the address and click on the ‘Submit’ button.

The following documents are required for the NGO DARPAN registration:

☑ Copy of the NGO registration certificate. 

☑ Pan card of the NGO.

☑ PAN and Aadhaar cards of three members who exist in the NGO’s executive committee.

Tax Deduction on NGO donations

NGOs must register under Section 80G of the Income Tax Act, 1961, and obtain an 80G certificate. Donations made to NGOs with an 80G certificate are deductible up to 50% of the donor’s taxable income.

Conclusion

Government funding for your NGO in India is a strategic move. It can significantly impact your ability to bring about positive change. This guide outlines the steps to secure government funding and provides information on various funding opportunities. With persistence and dedication, you can sail your NGO to success. You can make a lasting impact on the communities you serve.

Frequently Asked Questions (FAQ)

How can NGOs raise funds in India?

1. Events. Organising an event is a proven method to mobilise funds and support for a cause
2. Personal solicitation
3. Network Fundraising
4. Online Fundraising
5. Volunteering
6. Donations in Kind
7. Raising Money From Young People And In Schools
8. Periodic Donation Through Adoption Of A Project.

What is the purpose of fundraising in an NGO?

Fundraising will give your NGO a boost and take you toward your goal of helping people. Now, this campaign fundraising can be either planned offline or online. It involves many audiences and donors. However, an online NGO fundraising campaign is much more effective as it covers an insanely large audience.

What are the four types of fundraising?

Individual giving, major gifts, corporate giving, and grants

What are some common ways for NGOs to raise funds in India?

Events, personal solicitation, and network fundraising. Online fundraising, volunteering, and donations in kind. Raising money from young people and in schools. Periodic donation through adoption of a project.

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