Question

What is the primary difference between a grant and a loan in resource mobilisation?

• A. Grants are only for non-profit organizations, loans are for businesses.
• B. Loans require collateral, grants do not.
• C. Grants offer lower interest rates than loans.
• D. Grants do not need to be repaid, while loans must be.

Answer 1

Answer:

D. Grants do not need to be repaid, while loans must be.

• This is the fundamental difference. Grants are non-repayable funds, typically given for specific projects, whereas loans are a form of borrowed capital that must be returned over time.