Which is the best description of how a scholarship differs from a federal education grant?

Scholarships can be awarded for various reasons, but federal grants are usually based on a student’s financial need.

Scholarship is a sum of money meant to pay for education expenses given to students based on academic performance, and they are not expected to pay the money back. On the other hand federal grants are financial awards by the federal government that are normally dispensed by the financial aid office of a college or university based on the need but can also be based on merit.