Ontario OSAP Changes Slash Grants, Boost Loans: What Students and Institutions Must Do Now

Hook

On February 12, 2026, the Ontario government announced a sweeping overhaul of the Ontario Student Assistance Program (OSAP), dramatically reducing the maximum grant portion for most students from 85% to just 25% beginning in fall 2026, while ramping up the loan share to 75%. Simultaneously, a seven-year tuition freeze will end, allowing universities and colleges to raise domestic tuition by up to 2% annually for three years—triggering immediate protests and concerns about accessibility and mounting student debt.

Context

The Ontario government argues the rebalancing of OSAP is about fiscal sustainability and accountability. Premier Doug Ford described the former grant-heavy system as “not a freebie anymore,” and pointed to a $7 billion subsidy and new loan repayment deferrals as efforts to keep post-secondary education within reach. Under the new scheme, the province will invest $6.4 billion over four years in post-secondary education, including enhancements to the Student Access Guarantee, which provides targeted aid for low-income students. However, all OSAP grants for career college students will end entirely after July 31, 2026.

What’s more, for the first time since 2019, Ontario’s post-secondary institutions will gain the authority to increase domestic tuition by up to 2% per year for three years. For a typical undergraduate student, that could mean an extra $170 in annual tuition, and potentially thousands more over a full degree.

The context for these changes is challenging: declining international student enrollment (and the resulting loss of higher tuition revenue), rising inflation, and ongoing concerns about post-secondary funding priorities. Universities like Toronto Metropolitan University (TMU) acknowledge that the tuition hike only partially offsets these pressures.

Impact

For Students

The immediate effect on students—especially low- and middle-income families, Indigenous, disabled, and first-generation students—is the potential closing of doors to higher education. As the Canadian Federation of Students warns, the reconfiguration will force more students to take on increased debt, disproportionately affecting those least able to afford it. There is a heightened risk that students may choose fields of study not out of passion but affordability, further skewing future workforce trends and reducing program diversity in fields such as the arts and humanities.

Career college students are hit hardest, losing access to OSAP grants entirely after July 31, 2026. This could mean much lower enrollment in career and technical programs, sending ripples through industries that rely on this talent pipeline.

For Colleges and Universities

While institutions now have room to adjust tuition and patch budget holes, they face significant enrollment risks. Marginalized and cost-sensitive students may opt out of post-secondary entirely, and increased stress and student dissatisfaction can take a toll on campus well-being and long-term institutional reputation. Schools are already signaling a commitment to efficiency and to protecting the most vulnerable through internal bursaries and targeted supports. Still, universities and colleges must now actively seek out alternative funding—through research grants, philanthropic partnerships, or institutional aid programs—to shield student access and diversity.

For Researchers and Nonprofits

With more students forced to rely on loans, researchers tracking access and equity in higher education will find a fast-moving policy landscape. Organizations serving Indigenous, disabled, low-income, or newcomer populations will see a surge in demand for scholarships, emergency grants, and wraparound supports. Advocacy will be needed to push for expanded federal or third-party funding streams—and to closely monitor the real impact on enrollment and graduate outcomes.

Action

For students and families:

• Start conversations early with financial aid offices about expected changes and eligibility under the revised OSAP. Look for institution-specific bursaries that may be expanded in response.
• Seek out alternative grants and scholarships from private foundations, federal programs (such as Canada Student Grants), nonprofits, and local community organizations. Application deadlines may shift quickly as demand increases.
• Monitor timelines—as career college students, for example, might have only one more academic year to secure OSAP grants.

For institutions and researchers:

• Begin scenario planning for enrollment and revenue impacts, focusing efforts on targeted aid programs and emergency bursaries.
• Build/strengthen partnerships with foundations, corporations, and granting agencies to create new pipelines for scholarship and research funding.
• Engage in evidence-based advocacy to highlight the impact of access barriers and push for further policy adjustments or safeguards.

Outlook

The OSAP overhaul marks one of the most significant shifts in post-secondary funding in a generation, with access and student debt emerging as core flashpoints. Grant seekers at every level—students, institutions, and nonprofits—should watch for emerging response funds, rapid policy adaptations, and new research on the real-world impact as enrollment and financial aid patterns shift over the coming years.

Granted AI can help keep you updated on rapid funding developments and new grant opportunities in this shifting environment.