AI in the Not-for-Profit Sector 2026

In 2026, AI in the not-for-profit sector has moved beyond experimentation. Charities are using artificial intelligence to improve fundraising, streamline operations, and deliver better services to beneficiaries.

What’s striking isn’t just how widely AI is being used, but how charities are using it: not to replace people, but to help them do more of what matters.

From Curiosity to Core Strategy

Over the past few years, AI adoption across the charity sector has accelerated at pace. What began as cautious testing of low-risk tools has, for many organisations, evolved into a core part of operational strategy. Today, a significant majority of charities are using AI in some form, from automating administrative tasks to supporting fundraising and service delivery.

That shift hasn’t happened in a vacuum. Not-for-profits are operating in an environment of increasing financial pressure, higher caseloads and growing digital expectations. AI has emerged to stretch limited resources further while maintaining and, in some cases, improving impact.

Key Applications of AI in Charities in 2026

Fundraising and Donor Engagement with AI

Fundraising remains one of the most mature and impactful uses of AI in the sector. Predictive analytics and propensity modelling allow charities to better understand donor behaviour, identifying who is most likely to give, who may be at risk of lapsing, and how to personalise engagement.

Used well, these tools help organisations communicate more thoughtfully, not more aggressively. For example, machine-learning-led audience segmentation has enabled some charities to significantly improve the return on major appeals by targeting the right message to the right supporters at the right time.

That said, donor perception still matters. While many donors are comfortable with AI being used behind the scenes for research and analysis, charities continue to tread carefully when it comes to AI-generated donor communications, where authenticity and trust are critical.

Grant Writing and Administration

Grant applications and compliance remain resource-heavy, particularly for smaller organisations. AI tools such as Microsoft Copilot and specialist charity platforms are now widely used to:

• Draft and structure grant applications
• Summarise complex guidance and eligibility criteria
• Support reporting and impact measurement

While these tools don’t replace expertise or insight, they can dramatically reduce the time spent on first drafts and administration, freeing teams to focus on strategy and relationships.

Service Delivery and Programmatic Impact

AI in the not-for-profit sector is also increasingly visible in frontline and mission-driven work:

• Accessibility: AI-powered chatbots provide 24/7 support, helping beneficiaries access information or guidance outside office hours.
• Environmental protection: Acoustic monitoring tools are being used to detect illegal logging and environmental damage in real time.
• Health and social impact: AI-driven datasets are supporting maternal care, health access and early intervention programmes across the globe.

Crucially, the most effective examples combine technology with human insight. AI provides data and signals; people provide context, judgement and care.

Operational Efficiency

Behind the scenes, AI has become a quiet workhorse. Automation of tasks such as data entry, meeting transcription, document summarisation and donor follow-ups is saving charities thousands of administrative hours each year.

For boards and leadership teams, AI tools are also supporting better governance, from automated meeting minutes to clearer briefing papers and faster access to information.

Challenges of AI in the Not-for-Profit Sector

The Digital Divide

Larger charities, particularly those with budgets over £1 million, are far more likely to have formal AI strategies and access to specialist support. Smaller and grassroots organisations often lack the capacity, internal expertise or leadership buy-in needed to move beyond experimentation.

These risks widen existing inequalities within the sector, not just between organisations, but between the communities they serve.

Governance, Ethics, and AI Policies

While AI use is widespread, formal governance has not kept pace. Many charities still lack clear AI policies, with common concerns including:

• Data privacy and GDPR compliance
• Algorithmic bias and representation
• Loss of the ‘human touch’ in sensitive interactions

Donors and beneficiaries expect charities to act responsibly. Transparent, ethical AI use is no longer optional; it is essential to maintaining trust.

Environmental Impact

There is also growing awareness of the environmental cost of AI, particularly the energy and water demands of data centres. For environmental charities, this creates a genuine tension between the benefits of AI tools and organisational values.

Leadership, Literacy and the Human Factor

One theme consistently emerges across the sector: leadership matters.

Charities that are moving beyond small pilots tend to have leaders who understand not just what AI can do, but how it might reshape their mission, operations and relationships. This includes understanding how beneficiaries themselves are using AI in the not-for-profit sector, whether to seek information, support or connection.

At the same time, there is a growing recognition that as technology accelerates, the value of human connection increases. Many predict a renewed appetite for face-to-face engagement, community-building and trust-based relationships, areas where charities excel.

The future is not AI or humans. It is AI with humans.

Digital Skills and Training for Charities

For organisations looking to adopt AI responsibly, support is available:

• Training: Free AI skills programmes from Charity Excellence and Microsoft’s Digital Skills Centre
• Policy and ethics: Frameworks to guide responsible, mission-aligned AI adoption
• Advisory support: Specialist consultancies offering tech audits and implementation advice

Investing in digital and AI literacy, particularly at the leadership and board level, will be key to ensuring AI delivers genuine social value.

Looking Ahead

A year is a long time in digital. In AI, it can feel like a decade.

By the end of 2026, the charities leading the way will not simply be those using AI, but those that have redesigned systems, delivery models and knowledge practices around it, embedding AI in the not-for-profit sector in ways that are human-centred, context-aware and aligned with their mission.

The not-for-profit sector has a unique opportunity: to act as a bridge between fast-moving, AI-driven technology and communities that might otherwise be left behind. With the right leadership, skills and values, AI can become not just a tool for efficiency, but a catalyst for deeper, more sustainable impact.

Want to see how we support charities with digital and AI skills? Contact us today!