A Guardian report says the aim of the aid is to prevent him from overspending. The king's choice is to provide a "permanent solution" to the problem of Andrew Mountbatten Windsor, as Andrew will now be known.
He will receive a six-figure sum to cover his move from the royal residence in Windsor to a private residence in Sandringham. The move will not be completed before Christmas.
He will later receive an annuity from Charles' own funds.
It is estimated that the pension will be several times larger than the Royal Navy pension, which is £20,000 a year.
Talks on the relocation package are believed to be ongoing, The Guardian reports.
A palace statement on Thursday said the king had begun the formal process of "removing Prince Andrew's title and honorary titles" and that formal notice of expulsion from the royal residence had been served.
British Prime Minister Keir Starmer is said to fully support the king's decision. The government was consulted before Buckingham Palace's announcement and made it clear it believed Charles' decision was constitutional.
It is understood that the Cabinet Office has been working with the king's advisers to find a solution that would avoid using parliamentary time and has sought advice from experts on constitutional matters.
