Manchester City or Chelsea will pick up £97m if they win the expanded Club World Cup this summer in the United States.

Fifa confirmed that it would hand the winners $125m of the $1bn prize pot on Wednesday as part of a move to make the competition attractive to clubs.

Around $500m of the prize fund will be split between the 32 participating teams while the other monies will be distributed based on performance.

The 32-team distribution split will be graded based on club contribution – Manchester City and Chelsea are likely to receive a lot more than clubs from the likes of Asia and Oceania.

“Fifa will neither retain any funding for this tournament, as all revenues will be distributed to club football, nor will it touch Fifa’s reserves, which are set aside for global football development through the 211 Fifa Member Associations,” Fifa president Gianni Infantino said in a statement.

The Club World Cup will begin on 15 July, with Chelsea the first English team to play a day later – just 22 days after the conclusion of the Premier League season on 25 May.

Chelsea will face Brazil’s Flamengo, Tunisia’s Esperance de Tunis and an unnamed third team, who will replace Club Leon after the Mexican side were ejected from the tournament for having the same owners as fellow Liga MX side Pachuca.

Manchester City will face Morocco’s Wydad AC, the UAE’s Al Ain – owned by City owner Sheikh Mansour bin Zayed Al Nahyan’s brother Sheikh Mohammed bin Zayed Al Nahyan – and Juventus. 

Fifa also confirmed that all revenue will be distributed to the club game with the organisation’s reserves untouched as a result of the tournament. 

“In addition to the prize money for the participating teams, there is an unprecedented solidarity investment programme where we have a target of an additional $250m being provided to club football across the world,” Infantino added. “This solidarity will undoubtedly provide a significant boost in our ongoing efforts in making football truly global.”