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Tens of thousands of students are relying on payday loans to cover their daily living costs, a survey suggests.

The survey of about 8,500 UK students by Unite Students, which provides student accommodation, found rising numbers reporting financial problems.

The report says 26,400 undergraduates and 5,400 postgraduates depend on payday lenders and could be paying annual interest rates of up to 1,500%.

Payday lenders said students are "capable of making informed choices".

Financial gap

The numbers reporting that they did not have enough to pay their daily living costs had risen by 12% in a year - which would mean that more than 600,000 students were struggling financially.

There was also an increase, of 7%, in students reporting that they were having to take on higher levels of debt than they had anticipated.

Jenny Shaw, head of student services for Unite Students, warns that payday lenders seem to be filling this gap.

"It's worrying to see a greater proportion of applicants believe payday lenders are the way forward," she said.

The report includes the case of Audrey Jordan, who ran up £6,000 in debts to payday lenders while a student at the University of the Arts in London.

She said that her part-time jobs were not enough to keep up with her daily costs and she had begun to borrow.

"I would say to students thinking about using a payday loan provider - take my advice: do anything you can to avoid it," she said.

There have been complaints from the National Union of Students that the maintenance loans and grants are insufficient to cover students' basic living costs.

Access to loans and grants is means-tested, and there have been warnings the maximum many families receive is not even enough to cover the cost of student accommodation.

Many students receive less than £4,000 in maintenance loans for a year.

Earlier this year, the BBC News website received a strong response from parents having to find thousands of pounds to cover the shortfall in student funding.

"With maintenance loans failing to cover the spiralling cost of student living, we are concerned many young people may feel they have no option but to risk exploitation by legal loan sharks," said NUS president Megan Dunn.

The Consumer Finance Association, which represents short-term lenders, said: "Students are educated and intelligent people who are capable of making informed financial choices."

A spokesman said responsible lenders would require borrowers to have "both regular and disposable income" and "unless students are in work while studying, it is highly unlikely that a reputable payday lender would approve a loan application or that it would be the right choice for most students".