If you support nonprofit clients, you need to be aware of some changes to Microsoft’s nonprofit licencing.
As of 1 July, 2025, the free Office 365 E1 and Microsoft 365 Business Premium grants will end. At renewal, eligible nonprofits can still get Microsoft 365 Business Basic free (up to 300 users), while Business Premium and Office 365 E1 will move to a 75 % off paid model.
What’s Changing
- Free E1 and Premium grants in Direct/CSP channels retire July 1, 2025.
- A customer renewing before July keeps their free grants until the next anniversary; renewals after July lose them immediately.
- Microsoft will notify subscribers up to 90 days before deactivation and retains data for 90 days afterward.
What’s Not Changing
- Paid licenses and the free Business Basic grant (300 users) remain unchanged.
- Enterprise Agreement E1 grants (up to 2,000 seats, with 250 paid minimum) still apply.
- Strong discounts (75% off) on E1 ($4.20/user/month) and Business Premium ($9.84/user/month) continue.
Why Is This Happening?
While Microsoft hasn’t shared a detailed explanation for ending the donation program, the company has acknowledged the impact on NFP organisations. In a statement to The NonProfit Times, a Microsoft spokesperson said:
“We’re committed to making this transition smooth and are working closely with partners to provide clear guidance and hands-on support.”
Options for NFPs
- Business Basic (free) – Core cloud services, ideal for small groups with modest needs.
- Office 365 E1 (discounted) – Unlimited users, basic collaboration tools; suits larger nonprofits.
- Business Premium (discounted) – Full desktop Office apps, advanced security and device management; best for those handling sensitive data.
Security Considerations
Nonprofits face frequent cyberthreats—68 % have experienced a breach in three years—so stronger protection often justifies the cost. Business Premium includes:
- Defender for Business (antivirus, EDR)
- Defender for Office 365 (phishing protection, safe links/attachments)
- Entra ID P1 (conditional access, MFA, self-service password reset)
- Intune (device compliance and remote wipe)
- Purview DLP and Azure Information Protection for data classification/encryption
These tools enforce zero-trust policies, secure mobile workforces, and guard donor and financial data—foundational for adding AI services like Copilot safely.
Cost vs Value
At just under $10/user/month, Business Premium includes Office desktop apps and a complete security suite—often more cost-effective than one‐off Office licenses or third-party protections. Compare that to the potential costs of a breach: legal fees, reputation loss and recovery. For many organisations, paying 25 % of list price for full protection and productivity tools is sound risk management.
Licencing on a Needs Basis
To manage budgets, assign Premium only to core staff handling sensitive data or heavy Office workflows and put others on Basic or E1.
If your clients are running Microsoft Business Basic, adding Guardz Professional can give you enterprise-grade threat detection, spam filtering and live endpoint protection. It plugs into your existing setup without extra complexity, stopping phishing, ransomware and zero-days proactively. You get stronger security coverage for less than the price of Business Premium, keeping costs predictable.
How MSPs Can Help
- Identify at-risk clients using Business Basic or expiring grants.
- Communicate changes early and empathetically.
- Analyse usage in the Microsoft 365 admin centre and right-size subscriptions.
- Back up NFP client files and data.
- Plan transitions via your Manage Protect portal, aligning with renewal dates.
By advising clients to adopt the right mix of Basic, E1 and Premium, you’ll help them maintain operations securely and affordably. Manage Protect is ready to support your nonprofit clients through this transition, please reach out for personalised assistance.
