More than half of the cash (£45m) will be used to provide zero-interest loans to nearly 70,000 people struggling with their finances amid the current cost-of-living crisis.

Meanwhile, £31m will be distributed to retrofit premises with new boilers or heat pumps, solar panels and new lighting.

The money is being distributed as part of the voluntary Dormant Assets Scheme which uses the forgotten funds from bank and building societies for good causes while it aims to reunite people with these lost sums. See YourMoney.com’s Dormant accounts: How to trace your money for more information.

Since 2011, £892m has been released to help young people and those in financial difficulty. It will soon include assets from the insurance and pensions, investment and wealth management, as well as securities sectors.

But the Government has today announced that community wealth funds will become an additional beneficiary of the scheme. This will distribute money to communities in deprived areas over a longer time period, with residents able to make decisions on how best to use the money.

‘Life-changing difference’

Culture secretary, Lucy Frazer, said: “Today we are announcing that millions of pounds will be redirected from dormant accounts to help the most vulnerable in society deal with the cost of living.

“This will have a real impact on people’s lives, help alleviate debt and provide money saving solutions for charitable organisations.”

David Knott, chief executive of The National Lottery Community Fund, said: “As the distributor of dormant assets, The National Lottery Community Fund sees first-hand the life-changing difference this funding makes.”

Jane Hanson, chair of the Reclaim Fund Ltd and Dormant Assets Expansion Board, said: “The Government’s announcement on future dormant assets funding comes at a particularly important time given the pressures on so many households.

“Thanks to the collaborative efforts of the Dormant Assets Expansion Board, which brings together industry, Government and regulators, the Scheme is now poised for expansion, which could result in £880 million in additional dormant assets funding to good causes across the UK.”