Which financial aid eligibility criterion requires that students demonstrate financial need?

Need-based aid is specifically designed for students who demonstrate financial need, which is calculated based on the difference between the cost of attendance (COA) and the expected family contribution (EFC). This type of financial aid is intended to help students who may not have the financial resources to cover their educational expenses, ensuring that higher education remains accessible regardless of a family's financial situation. Need-based aid can come in various forms, including grants, low-interest loans, and need-based scholarships, and is often a key component of financial aid packages offered by colleges and universities.

In contrast, merit-based aid is awarded based on a student’s academic, artistic, or athletic talents rather than financial need. Academic scholarships similarly focus on academic performance without considering the financial situation of the student, and employment-based aid is tied to a student's work or job offers, not their financial need. Therefore, it is clear that of all the options, need-based aid is the only category that explicitly requires the demonstration of financial need.