The difference between an NGO, NPC and NPO explained

Updated: Mar 7, 2020

These three terms are very similar, but are different in function. Here's a short explanation to give you an overview.


NGO {non-government organisation}

This can be confusing - why the name "non-government"? The United Nations first used the term "NGO" to describe organisations that were not part of the government but performed functions that served society. The name has stuck and now it is used to describe any organisation or movement that serves a social purpose. This is sometimes also referred to as "civil society". It is more of a broad descriptive umbrella term, and NGOs can be structured as trusts, voluntary associations, non-profit companies and more.


NPC {non-profit company}

A non-profit company is a legal entity with the primary purpose of addressing a social cause or issue, rather than making a profit. If profits are made, they are usually channelled back into the NPC. A non-profit company is registered with the Companies and Intellectual Property Commission (CIPC). It is the most structured form that an NGO can take as there are governance obligations that need to be adhered to. Registering a non-profit company does not guarantee access to funding, but it does add to the credibility and trustworthiness of the organisation.


NPO {non profit organisation}

A non profit organisation is not a separate legal entity. It is simply a means of registering an NGO under the authority of the Department of Social Development. You can therefore register an NPC, a voluntary association or a trust as an NPO. This form of registration also brings with it the obligation to submit an annual report to the Department of Social Development. Registering as an NPO improves your organisation's credibility and may also put the organisation in a better position for certain funding applications. It will also allow you to open a bank account for the NGO.



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