How to Apply for a Cash Flow Loan
What is a cash flow loan?
Cash flow loans, also called program-related investments (PRIs), are loans and equity investments that foundations provide at favorable rates to support activities that have a direct charitable purpose.
In an effort to increase the impact of our resources and respond more quickly to the needs of our nonprofit community, we began providing these types of loans in 2003. Unlike grants, cash flow loans take the form of investments, usually requiring the return of capital within an established time frame, plus modest interest payments. For the recipient, the primary benefit is access to capital at lower costs and faster turnaround times than may otherwise be available. For the funder, the principal benefit is that the repayment or return of equity can be recycled for another charitable purpose.
Who is eligible?
Nonprofits that meet our eligibilty guidelines may apply for a cash flow loan. In addition, organizations must be able to show delayed receivables from government, foundation or corporate grants and contracts. Loans are made on a first-come, first-served basis from a revolving pool of $100,000.
What are the loan terms?
- Minimum: $10,000
- Maximum: $25,000 for organizations that have never received a grant award from the Knott Foundation; $30,000 for past grantees. From time to time, we may consider larger cash flow loans on a case by case basis. Please inquire if you are interested in a larger amount.
- Up to six (6) months
- 0.5% if repaid within 45 days
- 1% if repaid before 90 days
- 2% if repaid anytime after 90 days within the allotted six (6) month period
How do I apply?
Important: We do not accept requests for Cash Flow Loans through our online grant application module at this time.
Contact Christina Rickman, our Business Manager, to complete a brief background interview regarding your request.
Download and complete the required application forms:
- Monthly Cash Flow Spreadsheet (Excel)
Submit electronically or via hard copy the following documents. All documents listed below must be received in order for us to consider your application complete.
- A copy of the approved contract or grant award letter including specific award terms and conditions, the signature pages, the approved contact budget, and, if applicable, the notice to proceed letter
- A current list of the board of directors with addresses and board titles
- The past two (2) years audited financial statements
- The current year operating budget
- A year-to-date financial statement, including a balance sheet
- A signed copy of the most recent state or unemployment tax return
- A signed copy of the most recent 941 Employers’ Quarterly Tax return
Hard copies should be mailed to:
Marion I. & Henry J. Knott Foundation
3904 Hickory Avenue
Baltimore, MD 21211
What happens after I submit my request?
Once we have received your submission, your completed application packet is sent to a committee for further review, discussion, and approval. Loan notifications are made within two to three weeks of the application submission date.
If my request is approved, when is repayment due?
Repayments are based upon the terms of your loan agreement. If at any time you realize you are unable to meet these terms, please contact us immediately.
Is there a reporting requirement for approved loans?
Yes. Upon completion of the loan period, each borrower is required to provide us with a final report. This report is critical to our ability to evaluate the effectiveness of the program.