Grants and scholarships are a form of gift aid, which means that they do not need to be paid back.

A scholarship is a form of financial assistance that does not require repayment or employment, and which is usually offered to students who show potential for distinction, or who possess certain characteristics important to the scholarship provider (such as religious beliefs, hobbies, ethnicity, etc.).

A grant is a form of aid that does not need to be paid back and is typically based on need. Need-based grants require students to file the Free Application for Federal Student Aid (FAFSA) to determine if they qualify.