Bursary, Scholarship or Loan?

There is no doubt that going to university is an expensive business. Tuition fees can be as much as £9,250 per year in the UK, and then there’s accommodation, books and study equipment, as well as daily living expenses such as food, travel and clothes.

It’s no surprise that almost half of the students questioned by the 2019 Which? University Student Survey said they struggled with money.

Before applying to university, it’s important to understand how much it is likely to cost and to plan how you will pay for it. It is a good idea to research what kind of financial support may be on offer to you.

• Student loans are widely known and are available to help with day-to-day living as well as tuition fees.
  
  
• There is also a range of scholarships and bursaries that students are not always aware of. Crucially, these do not need to be paid back (except, in some cases, if you do not complete your studies). You are unlikely to find one that will cover all your expenses, but they may reduce tuition fees or help with living costs.

Unfortunately, there’s no central system setting out all the student scholarships and bursaries available. so it can take a fair amount of time and perseverance to track down the right pot of money.

And, confusingly, although scholarships and bursaries do differ, the terms are sometimes used interchangeably and some universities may have their own terminology.

In this article, we aim to help you work out which funding option might be best for you, setting out the differences between bursaries, scholarships and loans, explaining who is eligible for each and giving tips on how to apply.

What Is a Bursary?

Bursaries are usually based on financial need rather than academic merit; they support students from low-income backgrounds and other groups who may be under-represented in universities. They are generally non-competitive and may also be described as ‘awards’.

A bursary may be given as a lump sum at the beginning of the academic year or in termly instalments. Bursaries may be available directly from your university or further education college, through your local council, or via charities, trusts and other organisations.

How to Apply

The application process and eligibility criteria will vary depending on the university or other body providing the bursary, so it's important to check the specific details for each one.

Universities provide bursaries based on household income, but the threshold for this can vary greatly depending on the institution.

The majority of UK universities have a streamlined system to try to ensure that bursary applications and payments are as simple as possible and happen automatically for those who are eligible. This means that if you allow your student finance company to share the relevant information with your university, you should automatically receive the bursary if your household income falls below the threshold set by the university.

Aside from university-wide bursaries, there may be separate awards administered by individual departments or colleges (in the case of collegiate universities) so be sure to check all the relevant pages for information.

Specific bursaries are also available for those pursuing a career in the NHS, teaching or social work:

• Information on eligibility and how to apply for NHS and social work student bursaries is available on the NHS Student Services page.
  
  
• To find out about bursaries and other financial support for teacher training visit the government’s Get Into Teaching site.

There are also bursaries for international students. The British Council provides information on these and other funding for overseas students.

If you don’t qualify for a university or government-funded bursary it is still worth looking around for support provided by external bodies, such as local authorities or charitable organisations.

Criteria for these may be broader and there are a variety of bursaries for students in a whole range of circumstances. Talk to your careers department and contact your local council to find out what’s available.

Your student union’s welfare officer may also be able to point you in the direction of relevant bursaries. Alternatively, speak to your funding officer if you already receive some other form of financial aid.

When applying for a bursary, make sure you do it as early as possible.

What Is a Scholarship?

Scholarships cover the widest range of financial support for students and are given for all sorts of reasons by a variety of organisations.

Generally speaking, scholarships are awarded based on academic merit or a particular talent or achievement (such as sporting or musical prowess).

Some may give priority to students in financial need or from particular backgrounds. Unlike bursaries, scholarships tend to be competitive.

As well as university scholarships, businesses and professional organisations also offer scholarships both to attract talented students to their industry and more generally to raise awareness of their brand.

Some are open to anyone to apply and may even struggle to attract applicants; if you can find one of these, you will greatly increase your chance of success.

Some scholarships may be given as a one-off payment but, usually, they will continue for a set period and will come in the form of a fee waiver or discount, money towards living costs, or a mixture of both.

How to Apply

As with bursaries, application deadlines and criteria will vary, so check the details of individual scholarships.

For some, you may only be able to apply once you know your A-Level results or have secured a place at university. Others may only be open to second- or third-year students.

Your university may offer scholarships as well as industry-sponsored awards and you should be able to find details of both on the relevant faculty pages. Some scholarships may come with conditions or requirements, such as taking on an ambassadorial role or providing testimonials, so make sure you are happy with these.

You should also check the website of any relevant professional institutes for scholarships, and research any charities and businesses in your area of study which might offer support to students.

As scholarships are usually competitive, make sure you can highlight and demonstrate the relevant achievements and qualifications as well as any personal qualities that will make you stand out. It is also likely that you will need strong academic references to back up your application.

As with bursaries, apply as early as you can.

What Is a Student Loan?

A student loan is a loan specifically designed to help undergraduate students cover the costs of higher education. They are provided by the government-owned Student Loans Company and there are two different types of student loan:

• Tuition fee loan – This is to cover course fees and you could receive up to £9,250 a year. The money is paid to the university directly.
  
  
• Maintenance loan – This loan is to help students with living costs and is means-tested. The amount you receive is calculated based on where you plan to study as well as your income and the income of the people you live with. The calculation will take into account factors such as your age and both your income and that of your parents. If you’re living away from home in London, you could receive up to £11,672 per year; the sum will be less for those living and studying outside of London or living at home. The money is paid into your bank account at the beginning of each term.

If you are looking at postgraduate study, Postgraduate Master's Loans are also available up to £10,906 and Postgraduate Doctoral Loans up to £25,700, as well as other government support for certain postgraduate courses such as medicine and teaching. Check out gov.uk for more information.

You must be studying a course that is recognised by your student finance body and eligibility will vary if you are studying part-time.

Interest will start accumulating on your student loan as soon as the payments begin,. Currently this is charged at RPI (Retail Price Inflation) plus 3%.

You won’t start repaying the loan until the April after you leave university at the very earliest, and only once your income rises above a certain threshold. Currently, this is £25,725 a year for those who began their course after 1st September 2012.

You will still need to pay back your loan if you move overseas or become self-employed, as long as you are earning above the threshold. You can make voluntary repayments to pay off your student loan faster.

How to Apply

You can use the student finance calculator on gov.uk to estimate what level of loan you are eligible for. You can also use this to see if you qualify for any extra government-funded support.

Students from England can register and apply for student loans through Student Finance England. There are corresponding bodies for students who live in Scotland, Wales or Northern Ireland.

Applications for student loans can take up to six weeks to process, so be sure to apply as early as possible, ideally by the end of May for a course beginning between August and December that year.

You can apply before your place on the course is confirmed and you can change or cancel your application if your circumstances change.

Which Option Should I Choose?

The kind of student funding that you apply for will depend very much on your circumstances and to what extent you meet the criteria for the different options on offer.

It is a good idea to spend some time researching what’s available and speaking to people who may be able to help you weigh up the different options. This could include your school or college careers adviser, or your university’s funding or finance advisers.

The Scholarship Hub also has a database of scholarships and bursaries, along with tips on applying and advice on managing your money as a student.

• Those from low-income backgrounds should certainly investigate whether they qualify for maintenance loans and university bursaries. And if you come from any background that is under-represented in universities, it is worth looking into other bursaries that may be available.
  
  
• If you are academically gifted, have a particular talent or are pursuing a career that may attract industry-sponsorship (such as engineering), then a scholarship may be the best avenue of funding.
  
  
• If neither of the above applies to you, a tuition fee loan might be your only option. However, it is important not to assume you don’t qualify for other funding options until you have done some research. 

It is worth noting that you may be able to combine student loans, bursaries and scholarships, although you should always check the conditions for each one and ensure that receiving one source of funding does not affect your eligibility for financial support from elsewhere.

Final Thoughts

The cost of studying for a university degree can seem prohibitive to many. However, there is a range of financial support available that can go some way to easing the burden.

A student loan is a good place to start but remember that this will have to be paid back eventually, so also explore your eligibility for bursaries or scholarships which don’t have to be repaid.

The more unusual and little known sources you can seek out, the better your chances of a successful application.

And, if you can’t access the funding you need or find yourself struggling even with additional financial support in place, speak to your university or student union’s welfare officer as soon as you can.