Loans and Program-Related Investments (PRIs) for Nonprofits

It’s important to note that while grants and donations are often the key sources of funding for nonprofits, they aren’t the only sources. Often, the best option for a nonprofit is a loan or program related investment, known as PRIs. These kinds of funding options offer greater flexibility, helping nonprofits meet their needs without relying too heavily on donations or grants.

These sources of funding are especially useful for helping a nonprofit navigate a period of “scale-up”, as they need to tackle a particular project or grow.  A loan is to be paid back later after the nonprofit has grown, while a PRI returns a profit to the investor in question.

You can get loans from banks, credit unions or community development financial institutions (CDFI). PRIs, generally, are offered by foundations looking to earn financial returns while making a social impact. You may also see social impact investors and venture philanthropists offering PRIs.

Though they’re not grants, the process of securing loans and PRIs are somewhat similar - you have to show you’ve done your homework. The difference in this case is you need to spell out for the loan-giver or investor not only how their funding will be used, but also how it will be repaid. For investors, you will have to go through a process similar to working with grantmakers, where you demonstrate what the measurable impact of the investments will be.

You can find plenty of emergency grants below to apply for. And make sure to browse the rest of GrantStation for excellent webinars and tips on best grant writing practices.