Scholarships help the vast majority of students because most colleges don’t meet full need. I work in TRiO, at a college that cannot meet full need for all of our first gens. Every dime these students receive in outside $ is much appreciated.
My oldest received a small local scholarship. The organization handed the students a check at the organization’s award luncheon. We reported it, but it was all on us to do so. You see, someone in the organization had seen aid reduced for a past recipient and felt it was blatantly unfair, so it left it to the recipient. Awarding money directly to the recipient does create more potential for misuse of funds. Over the years, I’ve seen a few families that would have “needed” that money for something before the first tuition bill hit the mailbox.