The University of East Anglia's vice-chancellor has written to the Government calling for interest on student loans to be scrapped for 15 months.
Prof David Richardson is one of seven university vice chancellors who say that waiving the charge would ease the pressure on graduates.
It comes as the government says that students will have access to an additional £50m for hardship fund, on top of £20m agreed in December.
The call comes as the government announces an extra £50m for student hardship funds in England, on top of £20m agreed in December.
The extra funding will be distributed by the Office for Students (OfS) directly to universities, which will prioritise the students most in need of help.
In their letter to prime minister Boris Johnson, chancellor Rishi Sunak and education secretary Gavin Williamson, the vice-chancellors say students are paying a heavy price in the Covid-19 pandemic.
"The opportunity and wealth gap between the young and old is already unacceptably large - and existing challenges are being amplified by the impact of the pandemic on students and their life chances," the letter states.
“The pandemic has placed unprecedented pressures on our students. In some of our universities, demands for hardship funds have increased by over 100pc.”
Universities will be able to use the extra funding to help students facing loss of employment, additional costs for alternative accommodation, or to support access to remote teaching amid Covid-19.
The majority of university students have been told to stay at home and not return to campus under the latest lockdown, which has sparked calls for greater financial support.
All teaching and in-person supervision at the UEA, with some specific exemptions, will remain online until at least March 1.
Campaigners and student groups have called on universities, accommodation providers and ministers to go further with compensation to students facing lockdown disruption.
The UEA has said students who are not able to occupy their university accommodation room will be provided with an eight-week rent rebate.
The Department for Education (DfE) has said it wants providers of student accommodation - including universities - to offer partial refunds to students.
Universities minister Michelle Donelan said: "This continues to be an incredibly difficult and challenging time for our students, and I am hugely grateful to all the university staff working hard to prioritise their health, wellbeing and learning during this pandemic.”
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