Ed Miliband is set to launch the plan affecting the big five banks; HSBC, Barclays, Royal Bank of Scotland, Santander and Lloyds.
The strategy is intended to make it easier for new banks to break into the market and provide more competition.
Shadow chief secretary to the Treasury Chris Leslie, speaking on the BBC Radio 4 Today programme, said: “We have a situation now where a lot of customers feel as though what's the point of switching because they are all the same.
“If we are going to earn our way out of this cost-of-living hold that the country is in and if we are going to help those small businesses get the finance they need to build a better economy."
In 2012 the five leading banks accounted for 90% of the market share in Britain in terms of customer numbers and total lending figures.
Miliband said the banking industry had become "economically damaging and socially destructive" in July 2012 and called for significant changes.
Labour have argued that the "living standards crisis" affecting people on low and middle incomes can only be addressed by making structural changes to the British economy, including to the banks.
Miliband will also call for the Treasury to block the controversial plans by RBS to pay staff bonuses worth double their salary.
The largely government owned bank will require permission from shareholders to award bonuses greater than 100% of salary under new EU rules.