As many as 250,000 students will benefit from a £400 million expansion of the student grant system, the Government has announced.
Full-time students will qualify for a full grant of £2,825 if their family income is £25,000 a year or less, up from the current threshhold of £17,500.
The changes mean an extra £1,100 a year for a student from a household with £25,000 earnings, and an extra £1,000 for a family with a £40,000 income.
In total, two thirds of students will receive some grant each year, compared with just over half now, and a third will receive a full grant.
The Government has also introduced student loan "repayment holidays", allowing graduates to choose a repayment break of up to five years at a time of their choosing.
In addition, funding for the Student Associate Scheme, which allows high achieving undergraduates to act as mentors to young people in schools and colleges, will be doubled by 2010-11.
Bill Rammell, the Minister for Higher Education, told The Times Higher he could not reveal where the £400 million would come from in advance of the Comprehensive Spending Review. He promised, however, that the higher education budget would not be raided.