Cash Flow Loans
By Kelly Medinger
Helping organizations make ends meet in times of uncertainty
Financial uncertainty is more common than not in the nonprofit world. One estimate says that approximately one-third of all nonprofits operate in a constant state of financial distress (Mattocks, Zone of Insolvency, 2008). For others, financial distress can come at a moment’s notice. A late grant payment, a pending insurance claim for a major repair, or a lackluster fundraiser can make it difficult for organizations to make ends meet in any given month.
The Knott Foundation can serve as a source of help. In 2003, we began offering cash flow loans to qualifying nonprofits that meet our eligibility guidelines. In brief, we have the ability to provide short-term loans of $10,000-$25,000 with favorable rates and a quick turnaround time to nonprofits experiencing delayed receivables. You can learn more about the cash flow loan program and how to apply on our website.
Over the last 12 years, we’ve awarded 38 loans totaling $739,500. As of the date of this posting, all of the funds have been paid back to the Foundation. Many organizations have benefited and, while the number of loans awarded each year reached its peak in 2008, we continue to respond to inquiries and accept applications.
A few years ago we highlighted a story about one of our cash flow loan recipients and their journey with fundraising after undergoing a leadership transition. That story is just one example of how an organization experiencing unforeseen financial distress can benefit from a small loan to bridge a critical moment in time.
Cash flow loans are just one tool that we’ve been able to use to help make a difference in the day-to-day operations of the nonprofits we support. If you are interested in learning more about the program or applying for a loan, please take a moment to review our website or call our office.