Around two million people who were sold unnecessary security for bank cards will be able to start claiming compensation from the end of this month, the City regulator has announced.

The Financial Conduct Authority (FCA) said compensation forms would be sent out from later this month and throughout September, with the first payments expected to be made from late September.

The scheme will allow people to claim compensation if they have concerns about the way card security products were sold to them with the names Card Protection, Sentinel, Sentinel Gold, Sentinel Protection, Sentinel Excel and Safe And Secure Plus.

Customers paid £25 a year on average for the products.

Those who believe they were mis-sold have until March 18 2016 to claim compensation.

The amount of compensation will depend on the length of time the customer had the product, according to the FCA.

The FCA said the security products had some "unnecessary" features.

They covered fraudulent use if a card was lost or stolen. But this was not necessary because a customer's card issuer was typically responsible for any transactions after someone reported that their card had disappeared.

In the period before a card was reported as stolen, customers would only be liable for unauthorised spending on that card in limited circumstances. The bank or card issuer usually covered customers for anything over the first £50 if transactions took place before the card was reported missing.

The compensation scheme comes after the City watchdog reached agreement with 11 high street banks, credit card issuers and insurance provider Affinion.

Linda Woodall, director of supervision for retail and authorisations at the FCA, said the regulator had tried to make the redress scheme - called the AI Scheme - as "straightforward as possible".

She added: "If affected product holders have concerns about the way their card security product was sold to them, they should complete and return the original 'AI Scheme' compensation claim form received in the post to claim their money back.

"Anyone who receives a compensation claim form and wishes to claim compensation should do so straight away and not wait until the end of the seven-month claim period."

The FCA has not conducted a formal investigation into the matter, and said the agreement has been reached after voluntary negotiations. No enforcement action has been taken against Affinion or any of the banks or credit card issuers.

Those eligible for compensation will have bought or renewed the security products between January 14 2005 and August 2013. The products may have been sold alongside the card when it was taken out or the customer may have been contacted afterwards.

If customers are entitled to compensation, they will receive the amount they paid for the policy since January 2005, less any money paid out by the product and any applicable taxes. Interest of 8% interest per annum will be added to what they are owed.

Another scheme which operated in a similar way was set up last year to compensate people who took out Card Protection Plan Limited (CPP) card or identity protection insurance products.

Some 2.4 million claimants out of a potential seven million who were eligible applied before a deadline to receive their compensation.