December 29, 2025
No Comments
What Nonprofits Need to Know Now About Microsoft’s License Changes
That means organizations currently using these grant-based licenses will need to transition to new plans or begin paying for their existing ones at renewal.
Here’s what you need to know — and what to do next:
FREE LICENSES HAVE ENDED
Microsoft has retired the free grant-based licenses for both Microsoft 365 Business Premium and Office 365 E1. While your nonprofit may not feel an immediate impact, you will no longer be able to renew these free licenses moving forward.
WHAT HAPPENS AT RENEWAL
If you were receiving these free licenses, you can continue using them until your next renewal date. But once your renewal cycle begins (anytime after July 1, 2025), your organization must:
- Transition to one of Microsoft’s updated nonprofit plans, or
- Begin paying for your existing Business Premium or E1 licenses at the discounted nonprofit rate
This makes it essential to start planning now before your renewal comes due.
YOUR NEW OPTIONS
Microsoft is still committed to supporting nonprofits — but through a combination of free basic licenses and discounted advanced licenses:
- Microsoft 365 Business Basic (Free)
- Up to 300 free licenses
Includes core services like cloud-based email, Teams, and online Office apps
- Microsoft 365 Business Premium (Discounted)
- Up to 75% discount for eligible nonprofits
Includes desktop apps, advanced security, and device management
- Office 365 E1 (Discounted)
- Also discounted by up to 75%
- Includes web-based productivity apps and collaboration tools
THE IMPACT ON NONPROFITS
For many nonprofits, this change could mean new expenses where there were none before. If your team relies heavily on Business Premium or E1, your IT budget may need to adjust.
The good news is that Microsoft’s discounted pricing still offers significant savings — up to 75% off standard costs. This means nonprofits can continue to access robust productivity and security tools at a fraction of what commercial organizations pay.
MICROSOFT’S STATED COMMITMENT
Microsoft emphasizes that these changes are meant to keep solutions affordable, innovative, and sustainable for the nonprofit sector. While free Business Premium and E1 licenses are gone, the combination of free Business Basic and discounted advanced plans is designed to ensure nonprofits can still access the tools they need.
WHAT YOU SHOULD DO NEXT
If your organization hasn’t already planned for this shift, now is the time. At Nutmeg Technologies, we help nonprofits:
- Review your Microsoft 365 usage and licensing needs
- Identify the right mix of free and discounted licenses
- Build a transition plan before your renewal date arrives
- Ensure your team has the right tools to keep your mission moving forward without disruption
Contact Nutmeg Technologies today to review your Microsoft 365 setup and make sure your nonprofit is ready for this new licensing model. www.nutmegtech.com
Recent posts
December 1, 2025
No Comments
December 1, 2025
No Comments
