The British Council will be replaced by the outsourcing firm Capita in running a £110m a year student exchange programme.
The charity has been the lead partner in managing the Turing Scheme since it was launched in February, but has lost out to Capita, the government has announced.
The programme replaced the EU’s Erasmus+ Scheme, which the UK withdrew from after Brexit.
The British Council had worked on Erasmus+ and its predecessor, Erasmus, since 2007.
Bids of up to £7m were invited by the government to administer funding of £110m in 2022/23, tender documents show.
A government statement said Capita had been appointed to administer the scheme from April 2022 until December 2023.
The British Council said it and its consultancy partner Ecorys would work closely with Capita to ensure a smooth transition and there would be no gap in service.
“We are proud to have launched the Turing Scheme in February 2021 and supported £98.5m of grant funding in the inaugural year of the Turing Scheme, including 41,024 participants, of which 48 per cent are identified as coming from disadvantaged backgrounds,” the British Council said.
A Capita spokesperson said: “Following a competitive procurement process, we are delighted to have won this contract to administer grants for the Turing Scheme.
“We look forward to working with the Department for Education and our partners to enable students from all backgrounds to access global work and education opportunities.”
It declined to comment on how much it had bid to run the scheme.