Receiving foreign funds on a crowdfunding platform
I have incorporated an (OPC) Private Limited company on 30th of June 2016. What I intend to do through my company is - Crowdfunding.
Crowdfunding has various models. Ours is Donation Based crowdfunding.You can refer to the pdf attached (SEBI Consultation paper on crowdfunding) to know more in detail.
What happens in a typical crowdfunding platform is - People who are planning to do something of social value ask for donations from public in general. They post their project on a crowdfunding website and people interested to donate to that project donate funds online. The duration of hosting the project online and amount to be raised are pre-decided. Money donated by the donor comes to the company's account who are running the website. The company then deducts its service fees and transfer the rest of the money to the account of the person who is asking for money.
In such a scenario, if donations are coming from overseas, does the company who is providing the website interface need to comply with FCRA? - what is the procedure if you can guide us to understand.
It's pertinent to mention here that the funds come only in the form of donation. Donor expects no monetary benefit in return. He might get a Thank you note or memento in return but the price of that memento does not depend on the amount donated.
Crowdfunding companies registered in India as pvt ltd company and accepting funds from abroad as an mediator on other's behalf are - Wisberry.in or Ketto.org you can please refer to their websites to know more in detail.