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People often wonder about the difference between scholarships and grants. Both are student financial aid that helps to pay for the necessities associated with higher education such as tuition, room, board, and textbooks. Though people sometimes confuse the terms or use them interchangeably, each has their own eligibility requirements and guidelines. One similarity grants and scholarships have is that they don’t need to be repaid, unlike college loans. Let’s take a look at the various characteristics of scholarships and grants .


Grants and scholarships are not the same things, and the two terms are often confused. Scholarships are usually merit based. This means that they are given to prospective recipients based on desired qualities such as athletic ability, academic achievement or involvement in a certain extra-curricular activity. Scholarships can also be based on particular traits like ancestral background or group affiliation.

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Grants tend to be need-based and are available to students based on criteria such as family income. Federal and state government are the primary sources of grants, The Pell Grant is a well-known federal grant program. State-funded grants ordinarily go to students pursuing an education in that state.

Both grants and scholarships usually have some sort of requirements in order to continue to receive funding, such as maintaining a certain GPA. It’s important that recipients understand these requirements so that they do not find themselves without expected aid.

Sources of Funds

Scholarships are awarded by a number of funding sources. These can include businesses, religious groups, individuals, community organizations, college departments or alumni. Grants are different in that they usually come from state or federal financial aid that is given to the college or university itself. An example of a well-known grant would be the Pell Grant.


As long as they have applied to or are enrolled in an accredited college, university or other institution of higher education, students can usually be eligible for both grants and scholarships. In order to receive federal or state grants, applicants must be U.S. citizens. Scholarships usually go to undergraduate students. Once the graduate level is reached, private financial aid comes in the form of what is known as fellowships. These fund advanced studies and research. Grants, however, can be awarded to those pursuing either undergraduate or graduate degrees.


Scholarships are generally awarded based on academic or extra-curricular merit. They require an application outlining why an applicant feels he or she is deserving of the award. Grants often take financial need into account in determining one’s merit for receiving funding aid. Federally-funded grant recipients must fill out the FAFSA, Free Application for Federal Student Aid, in order to determine eligibility. These grants are not based on skill or achievement.

As you can see, there are numerous differences in grants versus scholarships. Do your research and be sure to submit all required paperwork properly in order to increase your chances of being awarded funding. There are a variety of scholarships and grants to be had, and most students are eligible for at least partial aid in some form.

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