Why more nonprofits are borrowing, not just raising money
A roundup of resources on how loans and impact investments can help nonprofits grow, weather funding gaps, and expand their reach.
September 8, 2026 | Read Time: 1 minute
For most nonprofits, funding strategies begin and end with grants and gifts. But a growing number of leaders are discovering that borrowing money — like a low-interest loan from a donor-advised fund or an impact investment — can help an organization move quickly to smooth over a revenue gap, finance a social enterprise, or fund capital improvements without waiting years to raise the cash outright.
The shift is happening on both sides of the table. Some foundations are moving beyond traditional grant making to lend directly, stepping in as local banks disappear and treating investment capital as an intentional tool for philanthropic impact. For nonprofits willing to think like borrowers as well as fundraisers, that opens a new path to growth and stability.
“Extending affordable financing alone will not be enough to solve our major national challenges,” says Antony Bugg-Levine, an expert in impact investing and former CEO of the Nonprofit Finance Fund. “But it’s hard to see how we will build more affordable housing, expand training and education to all the people who need it, navigate technology-induced economic shocks, protect our climate and natural heritage for future generations, and solve other national priorities unless more people and organizations can access the investment capital they need to turn opportunity and hard work into progress.”
We’ve collected perspectives from nonprofit and foundation leaders alike on how borrowed capital can strengthen your organization — from bridging funding gaps to financing expansion, and why more foundations are lending, not just giving.
Editor’s note: Chronicle playbooks are updated on an ongoing basis as new advice becomes available.
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