The Role of Microgrants in Improving Low-Income Students’ Academic and Financial Outcomes Across Demographic Characteristics

This quasi-experimental study examined the effectiveness of a one-time institutional microgrant program on academic and financial outcomes among Pell-eligible undergraduate students. Academic outcomes investigated included retention to the next semester, degree completion, attempted credit hours, and grade point average. The financial outcome captured whether students received a stop-registration hold due to an unpaid financial balance in the semester after receiving the microgrant. Estimates from a propensity score matching estimator reveal that microgrants applied to low-income students’ accounts can improve their retention and graduation rates. The microgrant was most effective among first-generation college students, resulting in the near elimination of the retention gap for first-generation students. Among students who were retained into the subsequent semester, the microgrant was not related to a student’s GPA or to the number of credits attempted in the subsequent semester. One concerning finding was that for students of color (Black/African American, Hispanic/Latine, Asian, Multiracial, American Indian/Alaska Native) who were retained, receiving the microgrant increased the likelihood of receiving a financial hold in the subsequent semester.