Student nurses at nine universities have had their loans and grants cut off or reduced after administrative errors meant they were previously paid too much, according to nursing leaders.
The Royal College of Nursing (RCN) said it has written to the Student Loans Company (SLC) urging it to write off overpayments amid concerns about the impact on those affected, such as their ability to pay their rent.
The RCN said it was aware of at least 100 second and third-year nursing students at nine English universities that have received letters from the SLC stating they had received too much money in their September and January instalments, and therefore upcoming payments would be reduced or stopped in order to recover the sums.
An SLC spokesman said they were investigating the error, and would use their powers to "defer the recovery action, if appropriate".
The erroneous sums ranged from £600 to £3,900, the RCN said, adding that a number of students had queried payments when they were made, but were told that they were correct.
It warned that the largest overpayments had been made to the poorest students, such as those receiving means-tested grants.
The SLC is the government body responsible for providing taxpayer-funded loans and grants to students at UK universities and colleges.
In a letter to the body, RCN chief executive Janet Davies said: "As you will be aware, most students budget according to loan forecast and a sudden withdrawal of payment can have disastrous results, such as inability to pay rent.
"This action by SLC comes at a critical time when students are studying for exams and projects, causing additional worry and stress."
She adds: "I am very concerned about the considerable amount of distress and disruption this error and subsequent action is causing. Student nurses, or indeed any students, are simply not in a position to cope with a sharp reduction in expected loan payments."
The letter goes on to say: "Given these circumstances, the responsible action would be for your organisation to immediately contact the Secretary of State for Education and the Department of Education in order to negotiate for these overpayments to be written off, in line with your organisational policy on change of circumstances and overpayments."
One affected student, Ewout Van Sabben, said: "I applied for a Maintenance Grant and was told I was eligible, now they say I am not. I planned my finances based on what the Student Loans Company presented to me.
"This is putting a big strain on my personal life and if it isn't resolved I will have to find another job. To threaten to take this money away so abruptly has left me worried. It makes me feel like I did something wrong."
Another, Emma Moss from the University of West London, said: "This is the last thing I need in the final few months of my nursing degree.
"I'm worried sick about being left with barely enough money to pay the rent, buy food and travel to work and university.
"When I called the Student Loans Company in September to question my payments, they told me that there was no error. Now they tell me that I owe almost £800 and will not be receiving my next instalment. If they take this money from me, I have no idea what I'm going to do next."
An SLC spokesman said: "We are investigating exactly how this error occurred and we are in contact with the students and institutions affected to make them aware.
"We do not want any affected students to suffer hardship as a result of this issue and will use our discretionary powers to defer the recovery action, if appropriate. We would encourage anyone affected to email firstname.lastname@example.org."