Your FDI Checklist 

When a foreign investor is ready to wire money, you’ll need these documents ready. Think of this as your “foreign investment starter pack”: 

1.Board Resolution 

Before accepting investment, your company’s board of directors needs to formally approve it. This Board Resolution should approve 

• How much money you’re raising (in dollars, euros, or whatever currency) 

• What type of shares you are issuing (equity or preference shares) 

• Who the investor is and where they’re from 

• The price per share 

• Any special conditions 

2.Investor KYC Documents 

Just like opening a bank account requires ID, accepting foreign investment requires thorough “Know Your Customer” documentation. 

For individual investors, you need: 

• Passport copy 

• Proof of address (utility bill, government ID) 

• Tax ID number (PAN equivalent from their country) 

• Bank account details 

For institutional investors (VCs, funds), add: 

• Company registration certificates 

• Fund authorization documents 

• Details of who controls the fund (beneficial ownership) 

Start collecting these before the investor wires money. Missing paperwork is the #1 reason for filing delays.

3.Valuation Certificate 

Here’s a critical rule: foreign investors cannot buy your shares below “Fair Market Value” (FMV) 

You need a chartered accountant, CMA or SEBI-registered Merchant Banker to issue a certificate determining your company’s FMV using recognized methods like: 

• Discounted Cash Flow (DCF): Your projected future earnings, discounted to today’s value 

• Net Asset Value: Your total assets minus liabilities 

• Comparable Companies: What similar startups are valued at 

• Recent Transactions: What investors paid in your previous rounds 

If the price per share is either too low or too high, that violates FEMA regulations and can trigger penalties. The valuation certificate protects both you and your investor. 

Important: If you’re raising money in multiple tranches over time, you need a fresh valuation certificate for each round as the valuation report is valid for 90 days from the valuation date. 

4.FIRC – Foreign Inward Remittance Certificate (Proof of Payment)

When your investor’s money hits your Indian bank account, your bank will issue a Foreign Inward Remittance Certificate (FIRC). This is your official proof that foreign currency entered India. 

The FIRC shows: 

• Who sent the money 

• How much (in both foreign currency and INR) 

• The exchange rate used 

• The purpose (should say “Foreign Direct Investment”) 

Note: Get the original or certified copy from your bank immediately for RBI filings. 

5.Company Secretary Certificate (Compliance Confirmation)

A qualified company secretary verifies that you’ve followed all the rules under the Companies Act 2013. This certificate confirms: 

• You’ve properly issued shares according to law 

• You’re legally allowed to accept foreign investment in your sector 

• You have all required documents (like the FIRC) 

• Your board resolution and approvals are valid

6.Share Purchase/ShareholdersAgreement 

This is the main contract between you and your investor, covering: 

• Investment amount and share price 

• Investor rights (board seats, information access, veto rights) 

• Exit rights (tag-along, drag-along, liquidation preferences) 

• Representations and warranties (promise about your business) 

• What happens if things go wrong (dispute resolution, indemnification) 

The SPA protects both parties and serves as evidence of the investment terms for years to come.

7.6 pointer remitter KYC

A 6-pointer remitter KYC is a mandatory set of six details required for foreign direct investment (FDI) filings in India, often included in the Foreign Investment Reporting and Management System (FIRMS) portal or in SWIFT messages.  

The 6 required KYC points are: 

1. Registered Name: The official name of the remitter (e.g., the individual/company’s/fund’s name). 
2. Registration Number: The unique identification number for the company. 
3. Registered Address: The physical address of the remitter. 
4. Remitter’s Bank: The name of the bank where the remitter holds their account. 
5. Remitter’s Bank Account Number: The specific account number for the remittance. 
6. Period of banking relationship: The duration for which the remitter has maintained an account with the specified bank.