Microsoft Ending Nonprofit Grants for Microsoft 365 Business Premium and Office 365 E1: What Partners Need to Know

Posted: May 15th

Author: MicroWarehouse

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Microsoft has just announced significant changes to their nonprofit grant program that will impact many organizations in our partner ecosystem. Starting July 1, 2025, Microsoft will discontinue the Microsoft 365 Business Premium and Office 365 E1 grant offers for nonprofit organizations.

What’s Changing?

In an effort to “streamline grant offerings and simplify the grant portfolio,” Microsoft’s Technology for Social Impact (TSI) team is making the following changes:

Discontinuing free Microsoft 365 Business Premium licenses for nonprofits
Discontinuing free Office 365 E1 licenses in CSP for nonprofits
Maintaining the Microsoft 365 Business Basic grant (up to 300 free licenses)
Continuing Enterprise Agreement paths for Office 365 E1 grants (up to 2,000 seats)
Keeping the 75% discount on paid licenses for nonprofits (including Business Premium at $5.50/user/month)

Timeline and Transition Details

The grants will expire at each customer’s next renewal date on or after July 1, 2025. For example, if a customer’s renewal date is in October 2025, they can continue using their current grant licenses until then.

After a customer’s renewal date, Microsoft will provide:

A 30-day grace period to access subscriptions
An additional 60 days before data deletion (following standard retention rules)

Why Are These Changes Happening?

According to Microsoft, 98% of nonprofits they serve have fewer than 300 full-time employees. The company states they wanted to simplify their offerings by focusing on the Microsoft 365 Business Basic grant in Direct and CSP channels, while reserving the Enterprise Agreement path for larger organizations.

Microsoft emphasizes that Business Basic and E1 have significant overlap in functionality, and they “did not want to confuse customers with two nearly identical free offers.”

Alternative Options for Your Nonprofit Customers

As a partner, you can help your customers transition to:

Microsoft 365 Business Basic grant (up to 300 free licenses)
Discounted Microsoft 365 Business Premium ($5.50/user/month)
Enterprise Agreement for larger organizations needing Office 365 E1

Nonprofits with more than 300 active users on the legacy Office 365 E1 grant can submit an inquiry to Microsoft for special assistance.

Feature Comparison: Business Basic vs. Other Plans

Microsoft 365 Business Basic includes:

Web and mobile versions of Office apps (Word, Excel, PowerPoint, Outlook)
Custom business email with Outlook (50 GB mailbox)
1 TB of OneDrive cloud storage per user
Collaboration tools (Teams, SharePoint, Bookings)
10+ additional business apps like Planner and Forms

The main difference between Office 365 E1 and Microsoft 365 Business Basic is the 300-seat cap on Business Basic.

How MicroWarehouse Can Help

As your trusted cloud distributor, we’re committed to helping you navigate this transition with your nonprofit customers. We recommend:

Identifying affected customers in your portfolio
Scheduling transition discussions before their renewal dates
Conducting security assessments to demonstrate the value of paid licenses
Leveraging Microsoft CSP briefings (nonprofits qualify toward CSP incentives)
Developing customised support offers for your nonprofit customers

Microsoft have provided:

Communications ahead of customer email announcements
Office hours to explain the changes (To be announced)
Support for transitioning customers to other grants or paid offers (To be announced)

Next Steps

Reach out to your MicroWarehouse account manager for personalised support
Review Microsoft’s official documentation
Begin planning outreach to your affected nonprofit customers

We understand these changes may create challenges for you and your nonprofit customers. Rest assured that MicroWarehouse is here to help you navigate this transition with minimal disruption.

For specific questions or assistance, please contact your MicroWarehouse account manager.