A Letter of Inquiry is a short expression of your project in letter format. Letters of inquiry are often abbreviated as LoI or LOI. Even though “letter” is in the name, LoIs can also be sent by email, not just snail mail. The letter of inquiry is often associated with the concept note and they both have many similarities.
The letter of inquiry should contain just enough information for the donor to understand what the project is and why they should would be interested. Typically, this means LoIs are 1-2 pages long. Nothing more is necessary at this stage.
Letters of inquiry are often sent to new donors as a soft ask if your program may be in line with what the donor is interested in funding. The purpose of the letter of inquiry is not to ask for funding, but to open communication with a donor, schedule a meeting, and move from unsolicited to solicited for the full proposal.
A benefit and challenge to the letter of inquiry is that they are personal. LoIs are written in letter format, from one person to another. This means the letter-writer should include their full name and contact information, and also know the name and position of the person they are contacting. This means the LoI is able to draw a relationship to the donor but also requires the NGO take time to research the donor.