Labour is to pledge to introduce a levy on the profits of payday lenders to help support credit unions and other low-cost alternatives to bank loans.
If elected in 2015, it would impose an extra charge on the lenders on top of fees already paid by all finance firms.
The measure will help those already in "desperate need" and people at risk of wracking up huge debts they cannot repay in future, Ed Miliband will say.
Lenders have been criticised for making loan offers with up to 4,000% interest.
The industry has been referred to the Competition Commission and regulators have promised a tightening of the rules, with all borrowers set to be offered an "affordability" check before being given a loan.
'Personal credit crunch'The Labour leader will claim the squeeze on living standards is causing a "personal debt crisis" with a third of those taking out payday loans currently doing so to meet the cost of heating their homes.
"The prices families have to pay keep on rising faster and faster than the wages they are paid," he is expected to say on a visit to south London. "For too many families the end of the month is now their own personal credit crunch."
End Quote Ed MilibandWe must protect the most vulnerable people in our society from the worst of exploitation by payday lenders"
Labour has already said it will cap the cost of credit and give local authorities new powers to limit the spread of payday lending shops in town centres.
But Mr Miliband is expected to say a future Labour government will go further and force lenders to fund cheaper sources of credit to provide a "real alternative for people in desperate need".
"We must protect the most vulnerable people in our society from the worst of exploitation by payday lenders.
"And it is right that the companies that benefit from people's financial plight, accept their responsibilities to help ensure affordable credit is available."
Mr Miliband says the party will consult on the rate of the levy and how it will be implemented.
He will praise the work done by Labour campaigners - including recently-promoted shadow minister Stella Creasy - across the country in helping families deal with soaring personal debt that they cannot hope to repay.
Payday lenders, along with all financial service providers, already pay fees to the Financial Conduct Authority to help fund services such as debt advice.
'Explosion'But Labour says the large profits made by some payday lenders mean that a supplementary charge is justified.
The government currently spends £13m on supporting the growth of credit unions but Labour says these organisations do not have the capacity nor the resources to offer help to all those who need it.
Labour says the "explosion" in the payday lending market - with it says has doubled in size to £2.2bn in the last four years - is directly related to what it says is a "cost of living crisis".
As many as five million families plan to borrow money from payday lenders in the next six months, and more than 1.5 million households spend more than 30% of their income on unsecured credit repayments, it says.
Labour has pledged to crack down on the "worst exploitation" by lenders and accused the government of "dragging its feet" over reforms to the industry and doing little to boost low-cost alternatives to payday lending.
But ministers say proposals announced by the Financial Conduct Authority earlier this month, including a ban on some products and a limit on the times loans can be rolled over, will "call time" on unscrupulous lenders.
The Church of England has condemned the practices and ethics of some payday lenders and pledged to launch its own credit service to force many of them out business.
But lenders say they are helping people in genuine need with no-one else to turn to and that firms who are members of Consumer Finance Association are heavily regulated already.
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