New OSAP Rules Take Effect in Ontario, Raising Concerns About Student Debt
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Ontario began implementing new changes to the Ontario Student Assistance Program, known as OSAP, on August 1, 2026, reducing the share of non-repayable grants and increasing the portion of financial assistance provided as student loans.
Under the new rules, grants can account for up to 25 per cent of the provincial portion of eligible assistance, while loans will make up at least 75 per cent. Under the previous system, some students could receive a significantly larger share of their funding as grants, depending on their financial circumstances.
The changes apply to study periods beginning on or after August 1, 2026, and affect both new and returning students attending eligible colleges, universities and other approved institutions.
Students enrolled at private career colleges will receive Ontario’s entire contribution in the form of loans, without provincial grants. The changes do not apply to federal grants provided by the Government of Canada, which will continue to be assessed under federal eligibility rules.
The amount of assistance will continue to vary according to household income, family size, tuition, books, living costs, course load and other factors. There is therefore no single estimate for how much additional debt every student will face, although a larger portion of provincial assistance will now have to be repaid.
Student organizations have criticized the changes, warning that greater reliance on loans could increase graduate debt and place additional financial pressure on students from low-income families, particularly as housing, food and transportation costs remain high.
The OSAP restructuring comes as Ontario allows publicly assisted colleges and universities to increase tuition fees by up to two per cent annually over the next three years.
The provincial government says the changes are necessary to keep OSAP financially sustainable over the long term. Ontario has also said additional support will be available for eligible low-income students whose OSAP funding does not fully cover tuition, books and mandatory fees.
Students are advised to review the updated assessment in their OSAP accounts and check the grant and loan amounts separately. Those facing a funding shortfall can contact their institution’s financial aid office to ask about bursaries, emergency assistance and other available support.
