In the 12 months after the eligibility criteria was relaxed, colleges reported an explosion in enrolments, most being recent graduates of masters and bachelors degrees at universities around the country. Now those same colleges are reporting hundreds of drop-outs as students give up on waiting to live in Canberra.

In July last year the ACT government widened the criteria for those seeking to be nominated by the territory government for permanent residency. If a potential migrant's occupation was not on the list of in-demand jobs, they could apply by proving a close connection to Canberra. This included living in the ACT for at least 12 months and studying a Certificate III or higher qualification at a local institution.

On June 29, the ACT government quietly announced it would no longer accept applications from anyone whose job wasn't on the list of occupations needed in the territory. A government spokeswoman said the change wasn't permanent, but there's no indication of when other potential migrants living in Canberra could apply again.

"When the subclass 190 visa popped up, the students started streaming in," Min Gurung, marketing and sales manager from JP International College, in Mawson said. The college experienced an increase of 300-400 students in the past year, with many students moving to the ACT with their partners and young families. Between 20 and 50 students had withdrawn from the college in the past month, with that number rapidly increasingly, Mr Gurung said.

Unity College in Belconnen experienced an almost two-fold increase in its student numbers to about 50, chief executive Jillian Pryor said. Since the eligibility has changed for the ACT government to nominate potential migrants for permanent residency visas, her students have been in the dark about what their futures hold.

Some operators of the colleges are reluctant to speak out, with one reporting his institution had about 100 students before July last year. In the past year, that number grew to about 300 students, but about 50 of those have left since the announcement. About 50 more who were due to start in the second semester intake dropped out before the course began on Monday.

The college boss attributed the growth, and the subsequent decline, solely to the change in visa rules in the territory. It's unclear what the impact will be on the business and the staff employed to cope with the growing demand.

The chief executive of another college said her enrolments had dropped from 580 students to 350 students since the change was announced by the ACT government, with the expectation the number could fall further.

"The ACT government is irreparably ruining its international reputation. This will affect every education provider," she said.

While operators have said they are worried about the future of their businesses, they are most concerned about the effect the changes have had on their students, who have been described as heartbroken.

"Current students need to be immediately grand-fathered," one operator said.

Ms Pryor believes there has been a significant loss of trust between international students and the ACT government.

"It's created instability and uncertainty about their future," she said.

While enrolments at existing colleges have ballooned, the number of colleges operating in the territory has also grown. It's believed up to eight colleges have opened in the past year and more applications could be in the works. The Australian Skills and Quality Authority wasn't able to confirm the exact number yesterday.

There are now fears about the financial viability of the industry in the ACT, and the jobs of those working at the colleges.

"All these colleges will go broke now if this stays," one operator said.

Liberal shadow education minister Andrew Wall met with affected students last week and heard their stories. He's written to the ACT government demanding an explanation of the changes and a road-map of what will happen in the future.

"The ACT opposition is deeply concerned at the decision by the ACT government," he said.

"It seems that potentially hundreds of students have been caught up in this and this places their futures under a cloud."

"This leaves the ACT in a very bad light on the international stage," Mr Wall said.

"At the time the government is seeking to promote Canberra as an international destination, in the background the government is taking policy decisions that close the door without any warning to people who have invested time, money and effort into coming to our city and contributing to the multicultural success story Canberra is."