Nonprofits: What You Need to Know About Microsoft Ending Free Business Premium

Big changes are coming for nonprofits using Microsoft 365.

As of July 1, 2025, Microsoft will no longer offer free grant licenses for Microsoft 365 Business Premium and Office 365 E1. If your nonprofit is relying on these tools, now is the time to act. Without a transition plan in place, you could face serious disruptions in how your organization communicates, protects sensitive data, and manages daily operations.

The Changes

Under Microsoft’s updated nonprofit licensing program:

• Business Premium and Office 365 E1 will no longer be free through nonprofit grants.
• Nonprofits can either:
  • Switch to Microsoft 365 Business Basic (free for up to 300 users)
  • Purchase discounted Business Premium or E1 licenses (up to 75% off retail)

If your organization currently uses these free licenses, they will remain active until your next renewal date, but a change is mandatory after that.

And while “free” might sound appealing, the real cost of downgrading could be your nonprofit’s security, compliance, and operational efficiency.

Six Key Differences Hitting Nonprofits

If your nonprofit manages donor information, financial records, or member health data, here is why a move to Business Basic might leave you exposed:

1. Email Security

• Business Premium: Includes Microsoft Defender for Office 365 to block phishing, malicious links, and unsafe attachments.
• Business Basic: Limited to standard spam filters.
• Why it matters: Phishing remains the top cause of breaches, especially in nonprofits.

2. Device Management

• Business Premium: Comes with Microsoft Intune to secure and manage devices, and even remotely wipe lost phones.
• Business Basic: Offers almost no device control.
• Why it matters: Staff using personal devices can open the door to serious security threats.

3. Threat Detection & Response

• Business Premium: Includes Microsoft Defender for Business for real-time detection and remediation.
• Business Basic: Lacks these capabilities entirely.
• Why it matters: Without Defender, you might not know you’ve been attacked until it’s too late.

4. Information Protection & Encryption

• Business Premium: Automates data classification and encryption with Azure Information Protection.
• Business Basic: Manual and error-prone.
• Why it matters: Automation reduces the risk of accidental data exposure.

5. Identity and Access Management

• Business Premium: Advanced identity controls via Azure AD Premium.
• Business Basic: Limited to basic MFA.
• Why it matters: Prevent unauthorized access with rules like blocking logins from unknown locations.

6. Compliance & Auditing Tools

• Business Premium: Includes tools like Data Loss Prevention (DLP) and Compliance Manager.
• Business Basic: Offers limited auditing.
• Why it matters: Nonprofits subject to audits or regulatory oversight need to prove compliance.

What Nonprofits Need to Do Now

Don’t wait for your renewal date to scramble for a solution. Here’s how to stay secure, compliant, and cost-effective.

1. Assess Your Current Licensing

Microsoft does not inform partners about your licensing status. Start by reviewing which users have Premium licenses and what tools they’re using. Need help? We can guide you through it.

2. Avoid a Full Downgrade

Not every user needs Premium, but some definitely do. Consider a hybrid approach: use Business Basic for general users, and Business Premium for staff handling sensitive data or working remotely.

3. Build a Strategic Plan

Yeo & Yeo Technology can help your nonprofit build a cost-effective strategy that protects what matters most — your mission and your people. We’ll help you mix and match license types, integrate necessary security tools, and plan a smooth rollout.

Make a Smooth Transition

This licensing change doesn’t have to derail your operations or your mission. With the right plan, you can maintain productivity, reduce risk, and stay within budget.

Contact our team for a free consultation. We’ll assess your Microsoft licensing, identify vulnerabilities, and create a roadmap that works for your organization.

Don’t let a licensing change create a security gap.
Partner with Yeo & Yeo Technology and protect your nonprofit with confidence.