How NOT to Loan Money to a Nonprofit Organization

Loans can be a vital, strategic tool for a charity. At the most basic level, donations do not always arrive before the expenses they are needed to cover. At such times, credit – in the form of a bridge loan, for example – might be the perfect tool to allow a nonprofit to survive until the particular donation or grant is received.

The simplest way to lend money to a charity is for a donor to just give the organization the needed funds – either through cash, check, or wire transfer – with the (often unwritten) understanding that the funds will be returned at an agreed upon time. As no financial institution is involved, this type of loan is given in a relatively shorter amount of time, less complicated (no/less forms), and cheaper (no/lower interest rate and associated fees).

Nevertheless, an organization or donor might not want to procure a loan this way but rather through a registered financial institution; such as a bank, credit card company, or insurance company. Continue reading

Weekly Must-Reads: March 14

A list of the essential articles I posted to Twitter from March 7 – March 13, 2010.  This week’s topics include: Nonprofit Strategy & Governance; Fundraising; Internet & Social Media; Finance & Economy; and Potpourri. Continue reading

Weekly Must-Reads: March 7

A list of the essential articles I posted to Twitter from February 21– March 6, 2010.  This week’s topics include: Nonprofit Strategy & Governance; Social Media; Israel Finance & Economy; Global Finance & Economy; & Potpourri. Continue reading