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PSARA License Registration made easy with Corpbiz

In India, if a person wishes to start a business related to a security guard agency, then they have to avail a PSARA license. The Ministry of Home Affairs made it compulsory to get the PSARA license to run a private security agency in India. A PSARA license is obtained through the regulatory authorities of a state where an individual wishes to start their agency. The provisions related to the same are mentioned in the Private Security Agencies Regulations Act (PSARA), 2005. Every state in India appoints a Joint Secretary who is responsible for controlling and regulating the private security agencies of that particular state. The license remains valid for a period of five years, and after that, the business has to renew the license 45 days from the date of expiry. The act has laid down provisions related to the eligibility, renewal, compliance, etc.

Who Needs the PSARA License in India?

India has become a hub for new ventures and businesses to open their offices in the current market. Approximately 1 30,000+ startups have opened their offices in the year 2023 itself. The number is just going to increase in the future. With new businesses forming, the need for security agencies to secure these offices has also increased. Since diverse establishments need security, not many certified and trustworthy agencies are present in the market to provide this service. In order to cope with this situation, the PSARA bill was introduced in India. As per this act, if a person wishes to start a security agency, they can avail of this license and can do that. The act was necessary for the following reasons-

  • To safeguard ethical practices in running a security business.
  • To make sure that all the present security agencies follow the correct protocols.
  • To attract individuals who can open a potential private security agency.
  • The license also gives a sense of trust in the private security agency.

Common Challenges in the Process of Application for PSARA Certificate

Here are some of the challenges a person faces when they apply for PSARA license -

Strict Eligibility Requirements

Meeting the strict eligibility requirements, including financial stability, clean background checks, and adherence to pre-specified standards, can be challenging for many applicants.

Documents Requirements

The application process necessitates the submission of various Documents, such as proof of financial stability, background verification reports, and compliance with labour laws. Assembling and providing accurate paper works can be time-consuming.

Background Verification

In the process of application of the PSARA license, a background check on the directors, key personnel, partners, etc is required. Even a single discrepancy will lead to delays or rejection of the application.

Infrastructure Requirements

Private security guard agency needs a specific infrastructure too. A security agency must have efficient communication facilities, a registered office, and infrastructure for training purposes.

Compliance Difficulties

PSARA License application comes with its own set of compliance requirements. A part of these compliance requirements is the need for training; to train their security guards, a Private security agency must enter into an MOU with a training institution, which is an additional challenge.

Financial Requirements

For the smooth processing of the application, it is important to make sure that the stakeholders are fully prepared to bear the fees of the PSARA License Application. Filing of the PSARA application is also dependent on the state-specific requirements related to the fees or cost of a PSARA License.

State Specific Variations

A PSARA or Private Security Agency License comes under the central government as well as the state government. Adapting and navigating through various state-specific requirements can also prove to be a challenge to businesses operating in multiple states.

Time-Consuming Process

The entire offline or online PSARA license process is very time-consuming. The process can take from 60 to 90 days to process. Even the renewal application can be very long and time-consuming as the authority will examine the application thoroughly.

Eligibility For PSARA License

Anyone can apply for a PSARA license in India as long as they fulfil the specific requirements. A PSARA License is required to start a private security agency business in India. The eligibility criteria mentioned in the PSARA Act are mentioned below-

For License

  • The business of a private security agency or the association has to be of Indian origin. If not, the majority of shareholding must be Indian.
  • The agency must have a clear background, without any offence or court cases.
  • If the individual has been imprisoned or convicted of any crime in the past, the period of imprisonment must not be more than two years to avail of a PSARA License.
  • The business owner must not have a background of false play in the formation or management of the business.
  • The business owner must have a background where they have been dismissed or exterminated from a govt. Job because of misconduct in the action.
  • The business owners must have any ties from an organization that is prohibited or banned in India.
  • The agency has to be approved by the controlling authority, which grants permission only after consulting the central government.
  • The guideline also suggests that the agencies have to prefer the candidates who've served in the following departments-
  • Indian Navy
  • Indian Army
  • Indian Air Force
  • Home Guards
  • Police Department

For Security Guards

In order to become a guard in a private security agency, the following criteria are to be met-

  • The guard must be a citizen of India
  • They must be of the age above 18 and below 65
  • Non-objectionable characters and antecedents required
  • Successfully passed the training to become a security guard
  • Physical standards are met
  • The court must not have convicted the individual
  • A govt. must have exterminated them. post due to misconduct

For the Owner

The eligibility criteria and mandatory requirements from the owner/director of the private security agency are mentioned below-

  • The owner must have a basic education at least till 8th standard in school.
  • They must be a citizen of India
  • They must be of age 18 or above
  • They must have completed the special security training
  • The antecedents of the owner must be verified by the controlling authority and the police department
  • They must have an adequate financial background to support the business
  • They must not have any pending court cases

Other Requirements

Other requirements related to the PSARA license are listed below-

  • Any kind of business entity is eligible to get a PSARA License. The list of entities also includes the following-
  • Private Limited Company
  • Limited Liability Partnership
  • Partnership Firm
  • Individual or sole proprietorship firm
  • The company's name must represent the firm's intent, and the name must include terms like 'Security Service' or 'Security Agency'.
  • The company's MOA (Memorandum of Association) must reflect the specific cause the company wishes to serve and clauses related to providing security services.
  • The company is required to sign a MOU (Memorandum of Understanding) with the training institute recognized by the state's controlling authority. The training institute will provide specialized training to the guards who will join the agency.
  • The whole idea of introducing such a law was to protect the public order, improve national security, and prevent any activity that could hinder them. Hence, an individual who is associated with a firm or group that is banned in India cannot obtain a PSARA license.

Are FDIs allowed to enter the Indian Private Security Agency Market?

As per the guidelines, a PSARA license will not be given to any agency that is incorporated in a foreign land. Also, agencies whose majority stocks are owned by a foreigner cannot avail of a PSARA license. Any foreign partnership or shareholding cannot apply to get a PSARA license. An FDI of up to 49% is allowed; however, they are subject to approval from the government. These companies need to make sure that all of their relevant Documents, along with FC-GPR, are approved and duly filed.

Process of Obtaining the PSARA License

The process to attain a PSARA license is written below-

Documents Preparation

The individual has to gather all the Documents that are required and organize them well for the purpose of obtaining PSARA License. They also have to maintain a record of the agency's directors and promoters along with different registration requirements. The Documents have to be without many mistakes to avoid any discrepancies. The applications for PSARA licenses are heavily scrutinized; hence, it's important to make sure that Documents are legible. Once the Documents are collected, the application has to be submitted to the online portal after e-signing the Documents.

MOU with Training Institutes

After collecting the Documents, the individual has to choose a training institute from the list of training institutes mentioned on the PSARA website. After selecting the institute, they have to enter into a Memorandum of Understanding (MOU) with them. This training is essential to know the aspects of the agency as well as train any potential security personnel. It is observed that agencies with affiliation with a training institute attract high-quality employees. Individuals who are ex-servicemen will receive certain relaxations and exemptions in terms of training.

Application Filing

The form-1 has to be submitted with suitable information mentioned in the form to the respective state authority responsible for granting the PSARA license. Form-11, along with the Affidavit in Form-111, must be submitted to verify the agency's antecedents.

Police Verification

A police verification is conducted once the individual has submitted the Form-1. The directors are also subjected to police verification if the agency is a partnership.

Grant of License

The state authority will investigate and examine the application. On successful examination, the individual will receive the PSARA license in form-1V. If any discrepancies are found, then the license may not be granted.

Documents Required to Obtain a PSARA License

The list of Documents required for a PSARA license is mentioned below-

  • PAN Card
  • Provident Fund Registration
  • Employee State Insurance Corporation (ESIC) Registration
  • Registration under the shops and commercial establishment act
  • Registration under the Labour Act
  • Identity proof of the directors
  • Identity proof of the employees
  • Copies of Income Tax returns of the directors
  • Two passport-size photographs of the promoters
  • PAN Cards of the promoters
  • Address proof of the agency office
  • Affidavit as under Section 7 (2) of PSARA, 2005
  • Security Training Affidavit
  • Certificate of company incorporation
  • A signed MOU with a training institute

Other Certificate and License required for a Private Security Agency

Here is the list of certificates and licenses required for a private security agency-

ESI Registration

In India, Private security agencies are required to have ESI registration as per the ESI Act of 1948. The registration ensures that appropriate healthcare and medical supervision will be given to the employees of the agency. The ESI scheme is governed by the ESIC (Employees State Insurance Corporation.)

PF Registration

The provisions of the PSARA Act also state that private security agencies also need to have a mandatory PF registration. This registration is significant for the employees to attain the benefits of the Provident Fund Scheme. The PF registration is supervised by the Miscellaneous Provisions Act of 1952.

GST Registration

A GST registration is required to get the GST Identification Number. The GSTIN is required to operate the private security agency legally. The security services are taxable under GST. Hence, it is significant to obtain the registration.

ISO Certification

An ISO certification is essential to ensure the reliability and efficiency of services the private security agency provides. ISO has laid down specific security operations management standards that apply to private security agencies, known as ISO 18788:2015. This certification proves to be highly beneficial to the business as it lets the clients know of the reliability and efficiency of the private security agency.

Grant Period and Validity of the PSARA License

The period to attain a PSARA license depends on the particular state authority. One state can take longer to process the request, while the other may not. Generally, it has been observed that the application takes around 60 days to process from the date of submission of the application as the authority will examine the data. The PSARA license remains valid for a period of five years for most of the states in India. The only exceptions are the states of Uttarakhand, Chhattisgarh, and Madhya Pradesh, where a PSARA license remains valid for only one year.

Appointment of a supervisor

To comply with the provisions of the PSARA Act of 2005 and get a private security agency license in India, the applicant appoints a supervisor. The supervisor is required to conduct and oversee the workings of the agency. They are supposed to supervise the security guards appointed by private security agencies. The supervisor must have a minimum of 3 years of experience working in the Navy or the Army.

How will Corpbiz help obtain the PSARA license?

Corpbiz is fully equipped to take care of all the services required to obtain a PSARA license in India. Our experts provide end-to-end services and are always a single step away from you to reach out. Our services will include-

  • Procuring Affidavits from PSARA
  • Filing the application on your behalf
  • Follow-ups with the regional PSARA department
  • Timely finish paper works and the processes involved
  • Highlight any discrepancies
  • A dedicated expert for your work

Frequently Asked Questions

All Indian nationals are eligible for a PSARA license. Indians who have been ex-convicts or have been a part of fraud in the management of a company are not eligible to apply for a PSARA License.

The full form of PSARA is the Private Security Agency Regulation Act.

The fees for a PSARA License can be around Rs. 5000 for 1 district, Rs. 10,000 for five districts, and Rs. 25000 for the entire state.

The process of filling out the PSARA form online is mentioned below-

  • File the application
  • Obtain MOU with a training institute
  • Police Verification
  • Document Verification
  • Grant of the license

If an individual wishes to establish a private security agency in India, then obtaining a PSARA license is mandatory.

The PSARA Act delivers a license that is required to establish a private security agency in India.

The controlling authority is a similar or equivalent post to the Joint Secretary of the State. The controlling authority of the state controls all the jurisdiction and final decisions.

Certain institutes listed on the PSARA website offer to provide training to the probable employees of the private security agency. This course of training is called the PSARA training. These institutes train individuals who aspire to pursue a career in security-centric businesses.

Individuals aged 18 to 65 are eligible as per the PSARA Act of 2005.

To run a security agency in India is highly profitable and lucrative. With the number of businesses opening in India, the need for security has also increased drastically.

An individual, group, partners, or business that is involved in activities like guarding, watching, protecting nay premises, is called the private security agency.

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