P.E.I.'s debt reduction grant can save students thousands of dollars, but fewer are applying

There’s been a significant drop in the number of students applying for and receiving money through a provincial grant program — one that could eliminate thousands of dollars in student debt, CBC News has found.

The Prince Edward Island debt reduction grant program is designed for people who have finished their studies in the last three years.

Graduates with P.E.I. student loans can receive up to $3,500 per year in tuition relief, to a maximum of about $17,000, through the program.

But since 2015, the number of students applying for and receiving the grant has dropped by about half.

Erica Kyalo, vice-president external with the UPEI Student Union, said many students simply don’t know it exists.

“I was not aware about this grant at all until I had to do my own research and see what it is about and how students can apply,” Kyalo told CBC News.

“It's a bit surprising that it has been there for a very long time and they haven't done the best to advertise it to students or just create an awareness about it.”

The drop in applications comes at a time when financial supports such as scholarships, bursaries and interest-free loans are becoming increasingly important as the cost of post-secondary education continues to climb. The average cost of undergraduate tuition in this country for Canadian students was about $7,700 in 2025, according to Statistics Canada.

To be eligible, applicants do not need to have attended the University of Prince Edward Island or Holland College. The grant applies to graduates of any Canadian post-secondary institution.

However, applicants must have lived on P.E.I. for the six months before applying, and the grant can only be used to reduce Prince Edward Island student loans, not Canada Student Loans.

Since the 2022-23 fiscal year, the number of grants awarded has dropped by about 36 per cent. Looking back a decade, the decline is closer to 50 per cent.

Ten years ago, the province distributed about $1.5 million in debt reduction grants to 331 applicants. Last year, that fell to roughly $552,000 for 126 applicants, according to provincial data.

Meanwhile, the Department of Workforce and Advanced Learning told CBC News in an emailed statement that the program had an annual budget of $980,000 for the 2024-25 fiscal year. That means the amount paid out last year was nearly half the available funding, which indicates that applicants weren’t being turned away because the program ran out of money.

The department suggested the decline in applications could be because other financial programs are more well known — such as the George Coles Bursary, the Marion L. Reid Grant, the Community Service Bursary and other federal aid programs.