A PRI, broadly defined, is a foundation investment to support a charitable project or activity involving the potential return of capital within an established time frame. PRIs include financing methods commonly associated with banks or other private investors, such as loans, loan guarantees, linked deposits, and even equity investments in charitable organizations.
Foundations commonly make PRIs as a supplement to their existing grant programs.
In most cases, funders make PRIs to organizations that have an established relationship with the funder as a grantee. When the organization seeks additional funding possibly for a project with income-generating potential the foundation may suggest a PRI in place of a grant. For the funder, one obvious benefit of making a PRI is that the repayment or the return of equity can be recycled for another charitable purpose. For the recipient, the benefit is access to capital at lower rates than may be otherwise available. Most organizations receiving PRIs use them to finance their own projects.