The Libor scandal began last summer when Barclays was fined £290m for fixing the inter-bank interest rate. UBS and RBS have also been fined hundreds of millions of pounds for rigging the rate, which is used to set a range of financial deals.

The Government has allocated £2.6m of funds today, bringing the total amount given to date to over £7m.

The charities named today, including the Army Family Federation, Combat Stress and the RAF Widows’ Association, will be the last to benefit from the first tranche of funding allocated.

The Chancellor, George Osborne, said: “Our servicemen and women make huge sacrifices on behalf of our country. That is why it is right that those who have paid fines in our financial sector because they demonstrated the very worst values are paying to support those in our armed forces who demonstrate the very best of British values.”