The previous article (How to Register a Non-Profit Organization in Zambia: A Step-by-Step Guide)
focused more on registering Non-Governmental Organisations (NGOs). As you're
registering your NGO, the term Non-Profit Organisation (NPO) will emerge and
sometimes be used interchangeably. However, there are notable differences
between NGOs and NPOs, and as you register them, you need to weigh which one
you want to consider.
This article will be brief and concise, listing the advantages and disadvantages of registering your group as an NGO or NPO.
NGOs and NPOs both aim to promote positive social change in the local community, the country, or even the world at large.
The following are considered to be some advantages of registering as an NGO:
- When registered, NGOs mostly operate on an international basis.
- They have one office recognized globally and are exempted from government taxes.
- They receive large amounts of funding from foreign embassies and donors, and they carry out their work on a large scale.
On the other hand, the disadvantages of NGOs are:
The registration process for NGOs takes a bit of time compared to NPOs (it takes approximately 90-150 days to register) due to the robust requirements set up by the registrar for NGOs.
- There is a need for a large group of office bearers (at least a minimum of 5 office bearers according to the NGO Act of Zambia).
- The board of the organisation needs to be set up at the initial stage of registration.
- Due to the large number of people, it might be hard to set up.
- It is more costly to set up and register compared to an NPO.
The following are the advantages of NPOs:
- They are cheaper and less costly to register and are a bit faster, as it takes typically days to register compared to NGOs, which take months.
- Just like NGOs, they are also exempted from government taxes.
- They do not need a board at the initial stage of registration, unlike NGOs, which need one.
- Member participation for NPOs is not mandatory but optional.
- NPOs need a small number to get started (minimum of 2 office bearers).
- They are recognised locally or regionally, while NGOs, on the other hand, are recognised globally.
Here are some disadvantages of NPOs:
- NPOs have a narrower scope of work compared to NGOs.
- There is a need for office registration in each country.
- NPOs are regulated by the Companies Act, which requires constant annual checkups.
- Funding is relatively low compared to NGOs.
- When considering setting up and registering either an NGO or NPO, it is important to research and tally which one best resonates with your vision/mission, resources, and labour to set up.
Need help registering your NGO? Contact (emwangaila@gmail.com)
or Mr Gregory M Sikeba (admin@gmsikeba.com)