Matching Funds in Grants: What They Are, Types, and How to Meet Requirements (2026 Guide)

What Are Matching Funds? Definition & Key Concepts

Matching funds are financial resources that grant applicants contribute to supplement the funding provided by a grantor. These contributions signal the applicant’s commitment to the project and help attract additional support. Common sources of matching funds include the applicant’s own budget, other grants, private donations, or in-kind contributions such as donated goods or volunteer time.

Grantmakers often require matching funds to ensure applicants are invested in the project’s success and to maximize the impact of their funding. However, not every grant program includes this requirement. The need for matching funds depends on the specific grant, the funder’s goals, and the type of project. To better understand which grants you may qualify for, see our guide on grant eligibility criteria.

Types of Matching Funds: Cash vs. In-Kind Contributions

Matching funds typically fall into two main categories: cash and in-kind. Cash matches involve actual money contributed by the applicant or third parties, such as payments for salaries, equipment, or project expenses. In-kind matches, by contrast, consist of non-cash contributions like donated materials, professional services, or volunteer labor that have a verifiable value.

Some grant programs accept both cash and in-kind matches, while others may specify a preference or require only cash contributions. Carefully reviewing the grant guidelines is essential to understand which types of contributions qualify. For example, a grant for community arts might accept donated venue space as an in-kind match, while a technology grant may require only cash. If you’re new to the grant process, our step-by-step guide to finding and applying for grants can help you get started.

Purpose of Matching Funds in Grant Programs

The primary purpose of matching funds is to foster shared responsibility and partnership between the funder and the grantee. By requiring a match, funders encourage applicants to invest in the project and leverage grant dollars to attract further resources.

Matching funds also demonstrate community support and can make a project more sustainable in the long term. For instance, a nonprofit that secures local business sponsorships as matching funds shows broad backing for its initiative. Additionally, requiring a match allows funders to stretch limited budgets and support more projects overall.

How Are Matching Funds Calculated for Grants?

Grant programs usually express matching fund requirements as a ratio or percentage. For example, a 1:1 match means the applicant must provide one dollar for every dollar of grant funding. Other grants might require a 20% or 50% match based on the total project cost.

Applicants must clearly document the source and value of their matching funds in the application. During the grant period, funders may request proof of these contributions. Accurate calculation and thorough documentation are crucial for compliance and successful grant management. For instance, if a project costs $100,000 and the grant requires a 25% match, the applicant must contribute $25,000 from eligible sources. For more on budgeting and documentation, check out our expert guide on project budgets in grant applications.

Examples of Matching Fund Requirements in Grants

Federal grants, such as those from the National Endowment for the Arts, often require a 1:1 match. In contrast, state and local grants may have a wide range of requirements, from no match at all to a significant percentage of the project budget.

Private foundations and corporate funders vary in their approach. Some may require a match to encourage broader support, while others do not. For example, a local community foundation might require a 10% match, whereas a corporate social responsibility grant could be fully funded without a match. Always consult the specific grant guidelines to determine if a match is needed and what types of contributions are eligible. For more on different types of grants, see our comprehensive guide to grants.

Federal vs. State vs. Private Grant Matching Requirements

Federal grants are more likely to require matching funds, especially for large-scale, infrastructure, or research projects. State and local government grants vary widely; some mandate matches, while others do not.

Private grants, including those from foundations or corporations, may use matching funds as an incentive to encourage community investment but are less likely to require them outright. Always read the eligibility and application instructions carefully, as requirements can differ even within the same funding organization.

FAQs About Matching Funds in Grants

Q: What are matching funds in grants?
A: Matching funds are applicant-provided resources (cash or in-kind) that supplement grant funding.

Q: Are matching funds required for all grants?
A: No, matching funds are not required for every grant. Requirements depend on the funder and program.

Q: How do matching funds work?
A: Applicants must document their match, which is then verified by the funder during the grant process.

Q: What is the difference between cash and in-kind matching funds?
A: Cash is actual money contributed; in-kind refers to non-cash goods or services with a measurable value.

Q: Why do grantmakers require matching funds?
A: Matching funds ensure commitment, leverage additional resources, and help increase project sustainability.

Q: How do I calculate matching funds for a grant application?
A: Use the ratio or percentage specified in the grant guidelines and document all sources with supporting evidence. For more answers to common questions, visit our grant eligibility FAQ.