Banks and building societies are to carry out checks on all current account holders to identify illegal immigrants, the BBC reports.
The measure, part of a government clampdown, will see them given a list of people who are liable for removal or deportation from the UK or who have absconded from immigration control.
Financial institutions will have to report any names they discover and freeze or close the account.
The move was backed by Parliament in 2016 and will be in force from January.
According to the Guardian, 70 million accounts will be looked at quarterly to check the holder’s immigration status.
The checks form part of a series of measures in the Immigration Act 2016 aimed at encouraging illegal immigrants to leave the UK voluntarily.
It follows on from rules passed in 2014 intended to check the immigration status of anyone opening a new bank or building society account.
The Home Office says it will only share details of immigrants who are in the UK unlawfully.
This will include those who have exhausted all appeal rights and who should be denied access to banking services, Home Secretary Amber Rudd said.
Ms Rudd added migrants in the UK legally will “of course” be able to continue using their accounts.
The Joint Council for the Welfare of Immigrants has criticised the action saying migrants “with every right to be here” will be affected.
Chief executive Satbir Singh told the Guardian: “The government’s own record shows that it cannot be trusted even to implement this system properly.
“Immigration status is very complex, and the Home Office consistently gives out incorrect information and guidance.”
A Home Office spokesman said: “We are developing an immigration system which is fair to people who are here legally, but firm with those who break the rules.
“Everyone in society can play their part in tackling illegal migration.”
The plans also include a crackdown on landlords and employers if either knowingly provide a service to anyone who has no right to be in the UK.