South Africa’s non-profit sector is facing an unprecedented funding crisis, according to the fifth NACOSA Network Survey. The survey of nearly 200 community-based organisations in 2025 reveals deepening financial insecurity, with many organisations struggling to stay afloat as funding cuts ripple through the sector.
Over a third of organisations surveyed report having less than two months of funding to continue operations. Almost a quarter have already lost more than half of their funding, while nearly a half are feeling indirect impacts through reduced or delayed partner disbursements. A quarter of organisations have been forced to restructure or lay off staff – with some cutting up to 75% of their workforce.
“The message from our network organisations is loud and clear: unless community based organisations, who are the last line of defence in poorer communities, are urgently resourced, the health outcomes for poorer South Africans are going to be catastrophic,” said Mohamed Motala, NACOSA’s executive director.
These organisations are the connective tissue in the HIV and gender-based violence responses – impacting the lives of millions of people. If they collapse, essential services and jobs, which are in themselves injecting incomes into poorer households, will be lost and vulnerable communities’ suffering will deepen.”
With foreign aid declining and government budgets shrinking, organisations are struggling to sustain programmes and retain skilled staff. While many recognise the need for sustainability planning, only 41% currently have an up-to-date plan. Fundraising remains the most significant challenge, with 88% of organisations finding it difficult.
Despite the challenges, organisations continue to value networking, with increasing engagement in national and sector-specific forums reported. As one survey respondent says:
Prioritize networking spaces that connect NPOs with donors offering structural funding (most of which was lost when USAID was terminated), as sustainability remains a key challenge. Long-term support for core operations is essential to maintain quality services and retain skilled staff.”
NACOSA is calling for urgent action to strengthen the sector’s financial resilience. This includes mobilising local, home-grown funding solutions and advocating for sustainable, flexible financing for independent civil society in South Africa. “This survey shows that organisations are facing unprecedented headwinds,” says Motala. “As a society, we must pull all the levers at our disposal to ensure that community organisations can continue to provide locally-appropriate services in communities.”
