At least 12,000 students from low income homes failed to claim bursaries they were entitled to last year, according to a universities' watchdog.
The Office of Fair Access (Offa) says many students in England are unaware they are entitled to £1,000 grants.
Students who come from homes with an income of less than £25,000 a year are automatically entitled to a bursary from their university.
But Offa estimates that up to 20% of eligible students did not claim.
Offa director Sir Martin Harris said he was surprised by the low take-up.
"Many institutions have made strenuous efforts to increase take-up by improving their bursary awareness campaigns," he said.
Offa believes universities have under-spent by £19m.
And it has written to a number of institutions which "could have been more pro-active".
There were problems with the forms students have to fill in to get fee and bursary support, but they have now been made clearer.
But David Baker, chair of the higher education colleges' body, GuildHE, says many of the traditional, "pre-1992" universities are not doing enough to reach out to students from poor and disadvantaged communities.
"It's not been something that's been part of their culture," he says.
"Poor families are very debt averse. Universities need to build relationships much earlier - reaching out to schools in disadvantaged areas."
This strategy has been used with success by another GuildHE member, Bishop Grosseteste University College Lincoln.
The college's student support advisers make contact with potential students at school and run finance workshops for students and parents. As a result its take up of bursaries is running at well over 95%.
Sir Peter Lampl, head of the education charity the Sutton Trust, says: "Government, schools and colleges should take note. Young people need better information before they have made their higher education choices. Simple steps like these could have an important impact."
NUS vice-president Wes Streeting said it was disturbing to see thousands of students missing out.
"This report underlines our view that the current system is failing to deliver on the government's widening access agenda," he said.