Ministers have stated that EU students applying to attend English universities for the 2017 academic year will be eligible for loans and grants, despite the uncertainty surrounding Brexit.
It's also understood that these loans and grants will be available for the duration of their degree course and they will be honoured even if Britain leaves the EU within that period.
Universities have said the announcement provides much needed clarification for the sector and must be adequately communicated to European students.
The government's guarantee ensures that EU students applying to study in England from 2017-18 will have access to the same funding and support they currently have now.
Universities Minister Jo Johnson said: "We know that the result of the referendum brought with it some uncertainties for our higher education sector. International students make an important contribution to our world class universities, and we want that to continue.
"This latest assurance that students applying to study next year will not only be eligible to apply for student funding under current terms, but will have their eligibility maintained throughout the duration of their course, will provide important stability for both universities and students."
Universities UK president Dame Julia Goodfellow said the announcement provides much needed clarity but every effort must be made to communicate the policy to prospective students across Europe.
It's hoped that similar reassurances will be given by governments in Scotland, Wales and Northern Ireland.