Charities and voluntary organisations will be able to use the money to support UK nationals preparing for Brexit with a focus on those who may struggle with the paperwork, the BBC said in the report.
This includes pensioners, disabled people, those in remote areas, and those needing translation help.
About 1.3 million UK-born people are residents in the EU.
Foreign Secretary Dominic Raab said on Thursday that the government wanted to help UK nationals be "fully ready for Brexit, whatever the circumstances".
Under the withdrawal deal agreed between former Prime Minister Theresa May and the EU, UK nationals would have kept their freedom of movement rights during a transition period.
However the deal was repeatedly rejected by MPs and the UK is currently set to leave the EU on October 31 without a deal.
There was uncertainty about what a no-deal exit would mean for Britons living in the EU but expats were being advised to register as residents of the country in which they live, the BBC reported.
The rules on residency, including deadlines for paperwork, vary from country to country.
The European Commission has urged EU countries, in the event of a no deal, to "take a generous approach to the rights of UK citizens in the EU, provided that this approach is reciprocated by the UK".
It said the EU27 "should adopt a pragmatic approach to granting temporary residence status".
( With inputs from IANS )