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The Federal Pell Grant program is a government run financial aid system for the needy students. It is mainly focused towards undergraduate students from the lower economic strata, although some qualified post secondary students also get benefitted from this program. This grant is allocated among students spread over 5400 institutions across the US. The amount of Federal Pell grant depends upon several factors – EFCs (student’s Expected Family Contribution), COAs (Cost of Attendance, as resolved by the institution of the student) and the student’s enrollment status (whether he or she is a part-time or full-time student). Any student participating in different courses in separate institutions is not eligible for Federal Pell grant.
Pell grant is named after US congressman Claiborne Pell. The basic criterion of Pell grant is that the amount is not to be reimbursed to the government. The grant is offered according to the need of the student and he has to submit an application through FAFSA (Free Application for Federal Student Aid). The number of Pell grant holding students can specify the percentage of students from the low income group and the statistics of economic diversity of the students appearing in different filed of studies.
As Federal Pell grant is not a repayment type financial aid, the maximum amount of grant has been fixed. In the current fiscal year, it is decided by the US government that a student can be awarded USD 5350 for higher studies. There is also an option to release an additional fund of USD 2675 during the summer.
Now during the last week, US government has renewed its educational loan policy and decided to take over all the transactions of student’s educational loan. Henceforth, all student loan will be financed by the federal government itself. It will forcibly stop all private finance companies to deal with any kind of educational loan. A good percentage of amounts generated from the loan program will go into the Federal Pell Grant program. This will surely enhance the cumulative amount that can be disbursed through the grant program. Experts from different walks of life have welcomed the government’s decision.
But this is too early to comment on this policy. Billions of dollars will be siphoned to an apparently non-productive project. Experts are anticipating a hike in inflation in coming months. The calculations are not yet completed. Thousands will be jobless from the private finance companies. And the benefits from aiding the needy students have to be analyzed. Only after that, a clear picture of the new program can be drawn. The legislation regarding the new policy was dramatic. The policy was marginally saved by a solitary vote of 211 to 210. All the Republicans in the House of Representatives voted against the bill.
New government policy is about to take shape within a week or two. The details of the student loan scheme will be framed and only after that, the positive and negative aspects can be clearly visible.
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- P-10-03: Revised 2010-2011 Federal Pell Grant Payment and Disbursement Schedules (financialaidnews.com)
