Finance Ministry wants banks to be exempt from CSR spend

Indian banks, particularly those owned by the government and facing an urgent need to raise capital, could get some relief.

The finance ministry has written to the corporate affairs ministry, asking the latter to exempt banks from the corporate-social responsibility (CSR) spending mandated by the Companies Act.

The Act, which came into effect from the current financial year, mandates companies to spend at least two per cent of their average net profit for the immediately preceding three financial years on CSR activities.

The CSR provisions within the Act are applicable to companies that have annual turnover of Rs 1,000 crore or more, or net worth of Rs 500 crore or more, or net profit of Rs 5 crore or more.