Difference Between NGO and NPO: Advantages & Comparison Table

It's difficult to explain the difference between NGO and NPO since the aims and activities of a non-governmental organization and a non-profit organization are so identical.

Table of Contents

difference between ngo and npo

Difference Between NGO and NPO

Numerous organizations and entities exist with the primary intention of improving society and turning it into a better world. Some companies, such as Non-Governmental Organizations and Non-Profit Organizations, are established by a group of people with the goal of assisting civilization.

Every Non-Governmental Organization (NGO) and a Non-Profit Organization (NPO) serve to enhance civilization and the well-being of humanity, as well as addresses different social and cultural issues. Although the words “Non-Governmental Organisation” (NGO) and “Nonprofit Organisation” (NPO) are sometimes utilized interchangeably, they have very different purposes and legal statuses. 

In this article, we will clearly explain the difference between NGO and NPO and go into more detail about their roles and advantages.

What is a Non-Governmental Organization (NGO)?

A non-governmental organization (NGO) is a non-profit organization that operates autonomously of any authority. NGOs, sometimes known as civil society organizations, are non-governmental entities that are formed on a local, nationwide, and worldwide scale to achieve a social or political aim such as human security or the ecosystem. 

Although the phrase NGO can pertain to a wide variety of occupations, it is most commonly classified into non-profit, decentralized entities that function outside of government oversight. Some NGOs are wholly funded by donations, while others are run by professionals.

Looking to register your business in India?

Role of an NGO

Non-governmental organizations (NGOs) serve an important function in social transformation for the improvement and advancement of mankind. It has been proved that these organizations are functioning in various regions of the globe and are committed to assisting humanity and other honorable objectives. It is vital that the NGO’s workers and staff are knowledgeable, disciplined, and enthusiastic about the group’s purpose and operations.

The Function of the Facility 

The non-profit organization serves as a means for people who are concerned about any social and economic problem to engage and provide extra help. NGOs help in resolving conflict and develop a sense of trust and trustworthiness.

Independence of Women 

In campaigning for women’s rights, the execution of main NGO responsibilities has gone a long way. Eliminating sati, dowry, harshness, and other societal threats to educating women, decreasing the female foeticide ratio, and providing jobs to women are just a few examples. It is still doing all possible to eliminate gender inequity. Many charities, such as Sewa, Agrani Foundation, Eklavya, and Environmental Action Group, operate for such objectives.

Boost Government Efficiency

NGOs are accountable for ensuring that the government reacts to individuals’ complaints and resolves their difficulties, making the nation’s work more accountable. By offering their research and expertise, NGOs are also permitted to make suggestions and encourage growth and adaptation in government choices.

What is a Non-Profit Organization (NPO)?

A Non-Profit Organization is abbreviated as NPO. An NPO can be established by a group of specific individuals who want to develop cultural, religious, societal, or career aspirations. The board of members of the NPO collects the initial investment. Since this is a non-profit organization, any excess monies are used to further the group’s goals rather than being distributed between its representatives.

A charitable foundation or membership groups such as a fitness club, women’s club, any social and leisure association, certain public educational institutions, public hospitals, and so on are all examples of non-profit organizations. Religious, benevolent, academic, community security, artistic, cultural, supporting domestic or international enthusiast athletics, and eliminating brutality to children and animals are all goals that NPOs pursue, although on a much lesser scale than an NGO.


Common individuals create non-governmental organizations (NGOs), which function independently of the authority. An NPO is a non-profit organization that was established purpose of providing products and services to the people while simultaneously operating on the idea that no membership would partake in the institution's earnings or losses.
An NGO is a non-governmental entity that is created by regular persons and functions independently of the government. NPO is a non-profit organization that provides products and services to people and operates on the idea that no member receives a portion of the entity's earnings or losses.
Non-governmental organizations (NGOs) work to improve a nation's culture and economy. It also improves awareness in the community of a wide range of topics, notably ecological sustainability. The primary goal of a non-profit organization forming a corporation is to support non-profit goals such as business, trade, crafts, charities, schools, faith, environmental conservation, welfare programs, athletics, and exploration.
Donations, as well as a variety of other techniques, procedures, initiatives, events, and operations, are used by non-governmental organizations to raise funding. Instead of splitting its surplus cash among its stockholders, an NPO uses them to further the purpose of the company. NPOs can generate funds through commercial borrowed funds from outside sources, international funding, or contributions from members and administrators.
NGOs are active all over the world. It has a fairly extensive operational area. The scope of NPOs' operations is limited.
NGOs can be registered under a variety of regulations and policies in multiple states, including the Trust Act, the Society Registration Act, and the Non-Profit Private Company Limited by shares Act. NPOs are registered under Section 8 of the Companies Act of 2013.
In India, a non-governmental organization (NGO) also includes a non-profit organization (NPO). A non-profit organization (NGO) is referred to as a non-profit organization (NPO).

Purpose of establishing an NGO or NPO

The main objectives of establishing an NGO or NPO are:

Improvement for society’s betterment 

The NGO shall use all of its resources and earnings throughout the year for charity endeavors that advance any specific religion, caste, creed, or community.

Purpose of promoting activities

They were established with the intention of using their earnings to advance sports, business, religion, art, social welfare, science, education, philanthropy, environmental protection, or any other activity as may from time to time be announced by the federal government.

Benefits of registering for NGO and NPO

  • Like other private and public company types has its corporate structure in the eyes of the state.
  • Workers or supporters can assist the team since they will be functioning for a worthy cause with all their hearts rather than focusing on the monetary aspect.
  • In some activities, NGOs and NPO are free from paying income tax and other payroll taxes such as amusement tax and goods and services tax.
  • Once you form an NGO, your initiatives for societal welfare and change will entice all domestic and international NGOs to participate in your organization’s mission. In certain circumstances, transnational corporations invest in non-governmental organizations (NGOs) that aid the needy or promote social change.


NGOs and NPOs are identical yet dissimilar. They are, nevertheless, striving for the better betterment of society. In any case, the job they undertake is vital to civilization, and many of the issues and initiatives we support today would not survive without these sorts of institutions. While both NGOs and NPOs are nonprofit organizations that strive to have a good influence, NGOs frequently focus on a variety of social, environmental, and humanitarian concerns. On the other hand, NPOs cover a broader spectrum of nonprofit organizations and may have a more localized or particular focus on serving the local population. Although they both support social issues and volunteer work, NGOs and NPOs have different organizational goals and legal statuses.


To carry out philanthropic, economic, or improvement programs, an NGO does not need to establish. Some sorts of operations, however, can only be conducted if the NGO is recognized under the nation’s special acts or regulations governing NGOs.

NGOs can take donations or charities from people, for-profit businesses, charity organizations, and authorities of all levels, including regional, state-wide, national, and international authorities. They can also collect annual dues and offer products and services as non-profit organizations.

An NGO is a non-governmental organization that was founded by regular people and runs independently of the government. An NPO, on the other hand, is a business established to offer services and products to the public and runs under the tenet that no member would partake in the organization’s gains or losses.

Non-profit organizations are created for charitable or social purposes. Typically, they support religion, charity, trade, the arts, and research for the benefit of society rather than for their own financial gain.

  • NGOs actively work to advance and enhance the social and political climate of the society.
  • NGOs are responsible for making sure that the government responds to citizen complaints and fixes their issues, increasing the accountability of the country’s activities.
  • NGOs are allowed to provide suggestions and promote growth and adaptation in government decisions by sharing their research and experience.