2020–21 Student Grants and Loan Increases

Summary#

These final amendments (SOR/2020-144) change the Canada Student Financial Assistance Regulations for the 2020–2021 loan year. They increase several grant and loan limits and add a temporary change to the Repayment Assistance Plan to help students affected by COVID‑19. The rules take effect on August 1, 2020.

What it does#

• Raises the maximum weekly full‑time Canada Student Loan from $210 to $350 per week for the 2020–2021 loan year.
• Doubles some grant amounts for that loan year:
  • Full‑time student grant maximum increased from $375 to $750 per month.
  • Full‑time students with dependants: up to $400 per dependant per month (was $200).
  • Part‑time student grant maximum increased from $1,800 to $3,600 per loan year.
  • Part‑time students with dependants: up to $80 per week for one or two dependants, $120 per week for three or more dependants; total cap $3,840 for the loan year.
  • Students with permanent disabilities: grant increased from $2,000 to $4,000 per loan year.
• Changes to the Repayment Assistance Plan (RAP):
  • Borrowers who were on RAP on March 31, 2020, who were current on payments and whose calculated monthly affordable payment was greater than $0, will be deemed to have a monthly affordable payment of $0 for the remainder of their RAP term, starting October 1, 2020.
• Adds updated income thresholds and phase‑out rates (new Tables 7–11 in Schedule 4) used to calculate who qualifies for the grants and how quickly grants are reduced as family income rises.
• Estimated fiscal impact and scope:
  • The government estimates the measures will cost $1.84B over three years and says about 768,000 students (new and returning) would benefit.

Who's affected#

• Current and new post‑secondary students who apply for federal student financial assistance in the 2020–2021 loan year, including:
  • Full‑time students.
  • Part‑time students.
  • Students with dependants.
  • Students with permanent disabilities.
• Borrowers on the Repayment Assistance Plan as of March 31, 2020.
• The federal program that administers these supports: the Canada Student Loans Program and its department, Employment and Social Development Canada.
• Non‑participating jurisdictions that receive compensation under the law (named in the regulatory statement): Quebec, Northwest Territories and Nunavut.
• The government estimates about 768,000 beneficiaries; exact individual amounts depend on family income, dependants, study weeks/months and other factors.

Why it matters#

• These are short‑term, one‑loan‑year changes aimed at easing the financial hit students faced during the COVID‑19 pandemic. More students will get larger non‑repayable grants and access to bigger loans for 2020–2021, making it easier to pay tuition and living costs.
• The RAP change helps borrowers who were on income‑based repayment relief avoid immediate payments when the moratorium ends, reducing the risk they fall back into hardship.
• The measures are meant to reduce the chance that students postpone or drop out for financial reasons and to protect graduation and future earnings. The changes are temporary and tied to the 2020–2021 loan year.