How AI Nonprofit Organizations Are Using AI

How AI Nonprofit Organizations Are Using AI—and Why IT Governance Matters More Than Ever

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Key Takeaways

  • FAQs How are nonprofits using AI right now?

    Nonprofits are using artificial intelligence (AI) for donor analytics, content generation, process automation, and decision support. Adoption varies widely based on resources, leadership buy-in, and digital readiness. Artificial intelligence is increasingly being explored for integration into nonprofit operations as organizations seek new ways to enhance impact and efficiency.

  • What’s holding some nonprofits back from using AI?

    Concerns about data privacy, ethical risks, lack of internal policies, and uncertainty about return on investment are common barriers.

  • What are the benefits of AI for nonprofits?

    AI can help streamline operations, boost fundraising, personalize communications, and scale service delivery—all with fewer resources. Nonprofit AI solutions are specifically designed to address the unique challenges and goals of nonprofit organizations.

  • What are the risks of using AI without governance?

    Without clear oversight, AI can introduce bias, create inaccuracies, expose sensitive data, and damage an organization’s reputation.

  • How can PSM Partners help?

    We provide AI readiness assessments, IT strategy, cybersecurity controls, governance frameworks, and ongoing managed services to help nonprofits adopt AI securely and responsibly.

Why AI Is on Every Nonprofit’s Radar in 2025

AI has shifted from emerging technology to everyday tool and nonprofits are paying attention. From donor engagement to internal automation, AI offers a range of opportunities to do more with less. Many organizations are already exploring AI platforms like Microsoft Copilot, Google, AI-powered CRMs, and fundraising analytics tools. These platforms can be customized to address the specific needs of each organization, enabling nonprofits to deploy AI solutions that best fit their unique goals. Others are still evaluating where to begin. 

The momentum is growing. Nonprofits are being asked to stretch resources further, deliver impact faster, and operate more efficiently. AI can help them meet those challenges by helping organizations focus on the most relevant data and actions to maximize impact, but only if it is introduced with care, alignment, and a secure IT foundation. 

Where Nonprofits Are Getting Real Value from AI Right Now

Fundraising and Donor Engagement: Nonprofit AI tools analyze donor data to identify giving patterns, segment audiences, and predict future gifts, helping to identify donor interest and target interested prospects more effectively. This allows for more targeted outreach and better stewardship. Platforms like DonorSearch and Agentforce for Nonprofits (by Salesforce) bring built-in AI for donor analytics, content generation, and outreach. AI can also help generate thank-you letters or social-media posts, streamlining donor engagement and prospect research. We provide guidance on selecting and safely implementing these tools via our partner network.

Internal Automation: AI-powered writing tools such as Microsoft Copilot can draft thank-you letters, summarize reports, and help staff prepare for meetings. Each staff member can perform tasks more efficiently, as AI agents take initiative to automate routine work, freeing up time for mission critical work. For example, an AI tool can automate scheduling or data entry, allowing staff to focus on strategic initiatives. AI also supports decision making and data analysis, providing valuable insights for better outcomes. Automated project updates keep teams informed and aligned. 

Supporter Communication: Chatbots powered by AI can respond to common donor questions, provide event information, or guide website visitors, all without staff intervention. These AI chatbots help organizations engage supporters and keep them involved with the nonprofit, improving access to information and supporting multiple language translations. AI can also generate content and create or edit video for outreach, further enhancing supporter communication. 

Grant Compliance and Reporting: AI can assist in parsing complex grant agreements and tracking deliverables, reducing human error and improving accuracy in reporting. Automated project updates ensure teams are always informed about progress and compliance. 

Program Delivery: Some nonprofits are piloting AI tools to help match beneficiaries with services or provide decision support in the field. AI supports programs by evaluating and improving program outcomes, using data analysis and decision making to optimize delivery and measure impact. AI-powered tools also improve access to information and support communication in multiple languages, ensuring programs reach diverse audiences. 

While these tools offer value, they must be implemented with careful oversight. AI should assist your team, not replace their judgment or voice. By focusing on what matters most and enhancing your nonprofit’s operations, AI adoption can drive impact and help your organization achieve its mission. 

How to Use Responsible AI Without Compromising Trust, Privacy, or Mission

As AI becomes more accessible, so do the risks of misuse. For nonprofits that rely on public trust and donor confidence, the stakes are especially high. 

Key risks include: 

  • Using biased or incomplete data that leads to unfair or inaccurate results 
  • Generating content that is factually incorrect or inappropriate for public use, especially when using generative AI, which may produce inaccurate or unsuitable material 
  • Failing to secure the nonprofit’s donor or beneficiary data during AI processing 
  • Lacking transparency about where and how AI is used 

Strong governance is essential to mitigate these risks. At PSM, we recommend building a formal AI governance framework that includes: 

  • Executive and board-level oversight of AI use 
  • Clear policies for how AI tools are selected, approved, and monitored 
  • Defined roles and responsibilities for staff using AI 
  • Strong data privacy and cybersecurity controls to protect the nonprofit’s information 
  • Routine reviews and audits of AI outputs to ensure accuracy and fairness 
  • Training for employees to understand both the capabilities and the limitations of AI 

Governance should also ensure that AI-generated content is appropriate and relevant for the nonprofit’s target audience. Good governance does not slow down innovation. It enables nonprofits to adopt AI with confidence and credibility. 

A Practical Roadmap for Nonprofits Getting Started with AI

Step 1: Identify Low-Risk Use Cases

Start with internal communications, donor outreach, or automating repetitive tasks. These areas typically offer fast returns with minimal risk, and nonprofit AI tools can be a great starting point.

Step 2: Pilot and Learn

Select one or two tools, such as generative AI for content creation, and roll them out to a small group. Monitor how they are used and gather feedback. Identify areas for improvement, gaps in policy, and how these tools improve access for your team. 

Step 3: Establish Governance

Create a lightweight AI policy to guide use across departments. Address data privacy, staff responsibilities, and acceptable use cases tailored to your nonprofit’s strategies.

Step 4: Expand Responsibly

Once governance is in place, explore expanding AI into donor insights, analytics, or service delivery—with appropriate oversight. Use AI to support your nonprofit’s decision making and strategic planning. 

Step 5: Partner with Experts

Work with an IT provider that understands both the technical and ethical dimensions of AI. This ensures you are not just adopting tools but doing so in a way that aligns with your mission and safeguards your reputation.

Measuring the Impact of AI

Measuring the impact of AI is essential for nonprofits that want to maximize the benefits of new technology while staying true to their mission. By leveraging AI tools, organizations can analyze data more effectively, make informed decisions, and drive greater impact in their communities. Whether it’s enhancing nonprofit marketing, streamlining program management, or improving fundraising, AI technology offers powerful solutions—but only if its effectiveness is regularly assessed. 

One of the most valuable uses of AI in the nonprofit sector is in prospect research. Tools like DonorSearch AI help nonprofit professionals identify potential donors by analyzing giving history and engagement patterns. This enables organizations to refine their fundraising strategies, create more personalized appeals, and ultimately increase fundraising revenue. To fully benefit from these AI-powered tools, staff need a strong foundation in AI literacy, allowing them to navigate new platforms and make the most of machine learning insights. 

To measure the success of AI initiatives, nonprofits should establish clear metrics and benchmarks from the outset. For example, tracking increases in donor retention, improvements in program management efficiency, or the effectiveness of AI-generated images and videos in social media content can provide valuable insights. By analyzing data on engagement and outcomes, organizations can see the real difference AI is making and adjust their strategies to maximize results. 

Ongoing evaluation is key to responsible AI use. Nonprofits should regularly review AI-generated content, assess the accuracy of machine learning models, and update their tools to reflect evolving community needs. This commitment to continuous improvement ensures that AI-powered solutions remain effective, ethical, and aligned with the organization’s mission. 

Bringing Together IT, Cybersecurity, and Ethical AI Adoption

t PSM Partners, we understand that nonprofits need technology that is not only effective but also secure, ethical, and mission-aligned. Our team helps organizations navigate AI adoption through the lens of IT strategy and governance. 

Our services include: 

  • AI readiness assessments tailored to your nonprofit’s unique operations and needs 
  • Development of governance policies and oversight frameworks 
  • Secure infrastructure design and ongoing cybersecurity monitoring 
  • Implementation support for deploying AI platforms, including tools like Microsoft Copilot, and guidance on integrating AI-enabled CRMs through our trusted partners.
  • Training and support to improve staff access to AI tools and help them adopt AI safely and confidently 

We serve as an extension of your team, providing the expertise and power of advanced AI solutions you need to scale your impact without compromising trust or compliance. 

Ready to explore AI with confidence?

Contact PSM Partners to learn how we can help your nonprofit adopt AI securely and strategically. 

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About the Author

Picture of Marisa Maiella
Marisa Maiella

I'm a dynamic Marketing Specialist with a passion for crafting compelling marketing campaigns and engaging content. Known for my creativity and strategic approach, I am committed to fostering brand growth and enhancing engagement through innovative marketing strategies.

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