Fear of debt is fuelling high drop-out rates among students from disadvantaged homes, a new report has found.

Researchers from the Joseph Rowntree Foundation said that the government will need to address the issue if it is to achieve its target of encouraging 50 per cent of young people into higher education and getting them to stay there.

With university tuition costs set to be increased to as much as £3000 per year, ministers will need to work to correct the impression that these "top-up" fees will affect poorer students.

Money problems and fear of running into debt are the principal reasons that disadvantaged undergraduates drop out, the report found, while wealthier students are less likely to have these difficulties.

The study followed the progress through university of more than 300 students from deprived neighbourhoods and found they were more likely to leave prematurely, either by failing to finish their qualification or foregoing the chance to progress to a more advanced course because of lack of cash.

Their college careers were also more complicated in that they were more likely to defer taking up their place and to switch courses or repeat a year for non-academic reasons.

The research, by Alasdair Forsyth and Professor Andy Furlong of the University of Glasgow, was carried out in Scotland.

But the authors said that their insights into the disproportionate drop-out rate among students from disadvantaged backgrounds were equally relevant to higher education in other parts of the UK.

Cash fears and a lack of money add to an unfamiliarity with higher education among those who are the first in their family to go to university.

This combination of factors often leads to inappropriate course choices and low morale among students who experience a culture clash between university life and their home backgrounds.

The researchers concluded that measures to raise aspiration levels and achievement in schools serving deprived neighbourhoods should be coupled with better advice and information for students who are thinking about going on to higher education.

They also recommended increases in financial support for disadvantaged students.

"Our work confirms that disadvantaged young people are not enjoying as great a level of success in higher education as their peers," Forsyth said.

"They are often deterred by economic hardship and fear of debt from entering full-time education in the first place. But those who do make it to university or equivalent degree courses are more likely to quit before reaching their academic potential.

"Better financial help, especially non-repayable bursaries, would enable more of them to complete their degrees, especially those who enrol for longer, more prestigious courses."