Picture this: a branch manager gets a call from a local nonprofit asking for $500 to buy school supplies for kids. She says yes on the spot. It's a good cause, it's a small amount, and the nonprofit probably has an account with the institution. The donation makes sense to her.
Two weeks later, a different branch manager receives a nearly identical request from a nonprofit seeking funds for school lunches. This manager says no. Not because the request was bad, but because he's more cautious about ongoing sponsorships.
Neither manager did anything wrong, exactly. But now you've got two similar requests, two different answers, and zero documentation explaining why.
This is what happens when your bank or credit union doesn’t have a well-defined process for reviewing donation requests. When employees don’t know your institution’s donation policy or how to submit requests for official review, it’s easy for donations to be approved or turned down with no clear reason why.
And without this documentation, it’s challenging for your institution to grow its community impact and make a real difference. If a board member or auditor ever asks how your institution decides what to fund, saying “it depends on who picked up the phone” won’t cut it.
What a Donation Request Review Process Actually Is
If someone can ask your bank or credit union for money and get an answer without anyone writing down why, you don't have a process. You have a habit (and a poor one at that).
A donation request review process is simply a documented, repeatable way to submit, evaluate, approve/deny, and track requests.
Here’s an example of a strong donation request review process:
Yes, this is a little more complex than “someone asked us for money so we gave it to them.” But that’s a good thing! Having a clear review process helps your institution make consistent decisions, stretch its giving budget further, and maximize its impact in the community. And best of all, you’ll have the data and documentation needed to back up that impact.
Why Banks and Credit Unions Skip This Step
No bank or credit union has a confusing donation review process on purpose. But it’s easy to slip into bad habits gradually, especially when nobody takes the time to establish a consistent process or communicate with their team.
This is especially true at smaller institutions. Your community impact team might be one person juggling donations alongside other responsibilities. Finding the time to not only define your donation review process but also implement it throughout your institution can sound more challenging than it’s worth.
And for large institutions, getting hundreds of employees familiar with a new process can feel out of reach, especially if your leaders are resistant to change.
There's also an emotional piece. Saying no to a nonprofit feels bad, even when it's the right call. Having strict criteria can feel like going against the generous, community-first culture your institution likely prides itself on.
But once this process is in place, your institution’s donation review process will be faster, easier, and defendable.
What's at Stake
You might be wondering why having a well-defined donation approval process matters. Maybe your institution only gets 10 requests per year. Or maybe you actually love living in spreadsheets and email (we won’t judge…much).
But this isn’t only about improving your internal process. It’s also about making a bigger impact, plus keeping your institution safe and compliant. An informal review process (or none at all) creates real risk in more ways than you might think.
Inconsistent decisions
When similar requests get different responses depending on who answers the phone, your community partners are going to notice. What might not seem like a big deal to you will be really frustrating for the nonprofit that was rejected for no clear reason. It’s also really difficult to defend these decisions when questioned.
Reputational risk
Community relationships matter, especially for smaller institutions. Funding one youth program while declining a nearly identical one, with no explainable rationale, is the kind of thing that gets noticed and talked about locally. You don’t want to be the bad guy in your community.
Every inconsistent donation decision is a missed opportunity to strengthen trust with nonprofits and the communities your institution serves.
Missed CRA credit
If your bank is subject to the Community Reinvestment Act (CRA), then having a clear donation approval process is a must.
Donations that support low- and moderate-income individuals or communities might qualify for CRA credit. But to qualify, examiners need documentation showing who benefits and why your institution provided support. If you’re approving donations with no documentation, then chances are it won’t count under the CRA, even if it otherwise would.
Clear documentation may become even more important for CRA consideration in the future. In late July 2026, the OCC and FDIC proposed an updated rule that would require large banks to document that community development grant recipients keep overhead costs at 15% or less. The goal is to make sure the money your bank donates is reaching communities instead of covering administrative bloat. Without a way to track this in your system, you’re likely to miss out on crucial credit.
Budget blind spots
When branch managers or other employees start promising donations left and right, your Accounting team is going to ask questions.
Without a strong review process, it’s easy to blow through a budget or forget to check with Accounting. Nobody wants to explain to leadership why the giving budget ran out in May.
Friction with examiners
Compliance exams and internal audits go a lot smoother when donation decisions are clear and include documentation. And no, saying “We just felt good about it” isn’t going to convince your examiner to count it.
Tips for Building a Clear Review Process
Having a clear donation review process doesn’t have to be complicated. Here are some tips for building a straightforward process without a lot of hassle.
1. Create an online donation request form
All donation requests should come in through the same channel. If a PDF works for your institution, then that’s fine. But a better way to collect and manage donation requests is through an online form that triggers a review workflow.
When all requests come in via one channel, they’re less likely to be lost in email threads and random conversations. Everything is documented, and you receive all the information you need to make a decision the first time around.
Check out this article to learn how to create a donation request form people will actually complete.
2. Define what causes qualify for a donation
When you have clear, written criteria, it’s easier for nonprofits and community organizations to know whether they should submit a request. It also helps your team make decisions and stay consistent.
For example, you might say that your institution prefers to focus on education for low-to-moderate income communities and that you don’t donate to any religious or political causes. When a religious organization goes to fill out your online form, they will quickly see that they don’t qualify. Now they don’t have to fill out a form that won’t be approved, and your team doesn’t have to spend time reviewing it only to reject the application.
3. Create an approval workflow
Ideally, your online request form should trigger an approval workflow. Most donation request software offers this functionality, and it’s something you should look for when choosing a software for donation approvals.
An approval workflow lets you define who should review each donation request. You can even change the path based on the donation amount, recipient, location, and more. A $250 request and a $25,000 request probably shouldn't follow the same path, and an approval workflow lets you change it with no extra effort on your end.
4. Document your reasons for approval or denial
Every request that is approved or denied should include a reason why. Did the request not fit your institution’s core values? Did it come from an organization we don’t work with? Was it too far out of your institution’s budget? Providing these answers will help you make similar decisions in the future and will give clarity when examiners and auditors start asking hard questions.
For example, saying "Approved because the nonprofit serves low-income students in our assessment area" is much more useful than simply marking the request "Approved."
5. Keep the budget in mind
It’s easy to go over budget when nobody knows the goal or what’s already been spent. To avoid the Accounting team knocking on your door, make sure that everyone involved in donation approvals understands your institution’s goals and can see a breakdown of what has been spent and what budget is left over.
Common Mistakes to Avoid
On paper, building a clear donation approval process may sound easy. But in practice, it can be a lot more complicated. Here are some common mistakes to avoid as you begin to outline your new and improved process.
Sending all requests down one path
While small institutions might get away with sending all requests to the same reviewer, larger ones should definitely consider changing it up.
Chances are a $1,000 request for school lunches doesn’t need the same scrutiny a $10,000 one does. Maybe a branch manager or member of the donation team has the authority to approve a small request. But a large one should probably go through the leadership team before a decision is made. By defining who needs to review a request and when, you ensure that every request is handled properly and given the scrutiny it deserves.
Automatically approving repeat donations without another review
Just because a donation was approved for a nonprofit last year doesn’t mean that same nonprofit should be automatically approved this year. Priorities change. Budgets change. And every donation request deserves an honest review.
Not watching for CRA-qualified donations
If your institution is subject to the Community Reinvestment Act, it’s important not to let potential donations fall through the cracks. If your team isn’t properly trained to recognize a community development donation when they see one, then that needs to change.
When identifying donations for CRA credit, it’s extra important to ensure that every donation includes the “why” behind the approval. Why did you donate to this cause? Who did it benefit? How does it fit under the definition of the CRA?
How Kadince Can Help
Now that you know how to build a strong process for reviewing donation requests, how do you actually implement it?
Believe it or not, many financial institutions still rely on spreadsheets, email threads, and PDFs to receive and review donation requests. This is manual and time-consuming, plus it makes it almost impossible to have one clear approval process. With so many moving pieces, it’s no wonder similar donation requests receive different answers.
Luckily, there’s a much better way to manage donation requests and approvals. Instead of manual methods, many banks and credit unions have turned to donation approval software to help them better review donation requests. While there are plenty of donation review softwares available, the best one built specifically for banks and credit unions is Kadince (though we may be a bit biased).
Kadince’s donation approval software makes it easy to collect donation requests through online forms, route requests to the proper approvers, see what your institution has done with the requesting organization in the past, stay on budget, and keep the Accounting team in the loop.
To see how Kadince makes this whole process easy, schedule a personalized demo.
A strong donation review process isn't about saying "no" more often. It's about making every "yes" intentional, consistent, and easy to defend. When every request follows the same path, your institution can build stronger community relationships, stay aligned with its goals, and clearly demonstrate the impact it's making.
So the next time a branch manager receives a request from a nonprofit seeking funds for school lunches, they know exactly how to get approval and how to document the response.
None of Kadince, Inc., its affiliates, or its respective employees, directors, officers, and agents (collectively, “Kadince”) are responsible or liable for any content or information incorporated herein. Read full disclosure.
