The 15 Royal Navy personnel held captive by Iran are to be allowed to sell their stories to the media.
The crew returned to the UK on Thursday after 13 days in captivity
The Ministry of Defence said their experiences amounted to "exceptional circumstances" that allowed its usual ban on such payments to be lifted.
Politicians and military commentators have attacked the move, warning the crew may lose public sympathy.
The sailors and Royal Marines were held after Iran accused them of entering its waters, a claim they denied.
The personnel later said they were blindfolded, bound and held in isolation during their 13 days of captivity.
In a statement the MoD said: "Serving personnel are not allowed to enter financial arrangements with media organisations.
"However, in exceptional circumstances such as the awarding of a Victoria Cross or events such as those in recent days, permission can be granted by commanding officers and the MoD."
But opposition politicians have been strongly critical of the move, with the Conservatives say a bidding war would be inappropriate and undignified and the Liberal Democrats warning the strategy could backfire.
Shadow defence secretary Liam Fox said: "Many people who shared the anxiety of the hostages' abduction will feel that selling their stories is somewhat undignified and falls below the very high standards we have come to expect from our servicemen and women."
Liberal Democrat leader Sir Menzies Campbell also expressed concern.
He told BBC News 24: "I am concerned about the possibility that there may be inadvertently leaks of sensitive information connected to intelligence.
"And there is, of course, the very understandable feeling of the families of
those who have died in Iraq as to why it should be that those who have survived should - putting it bluntly - profit in this way."
Faye Turney is free to sell her story
Leading Seaman Faye Turney, 26, the only woman in the party, was not among the six personnel who appeared at a press conference on Friday at the Royal Marines Base at Chivenor, Devon.
But reports in the Sunday Times and the Sunday Telegraph said the mother-of-one had now sold her story to ITV1's Tonight with Trevor McDonald programme and a newspaper for more than £100,000.
The Sunday Times reported the marines had decided to pool their money, giving 10% to their service benevolent fund, while the sailors were expected to keep theirs individually.
It said the MoD hoped to retain control over the publicity.
Former SAS soldier Andy McNab said he thought the MoD decision was "sensible" and showed "forward thinking".
He said: "I think the MoD now understand that the story will come out very quickly via a third party, whether it's a family member or even another service personnel, so by letting the 15 sell their story they have some control of what comes out in the public domain."
Col Bob Stewart, who commanded the British peacekeeping forces in Bosnia, said the MoD were in a "Catch 22 situation" as the soldiers would be "hounded" for their stories.
But he added: "The whole matter is extremely distasteful, because while these people are making a lot of money, six bodies have come back from Iraq in the last week or so in coffins, and their families will get very little indeed.
"They are not heroes by comparison."
Craig Murray, a former head of the Foreign and Commonwealth Office's maritime section, was also critical.
He said: "I think a great many serving military people are going to wonder where on earth this all leads and the idea that you can make several years' pay out of being captured - as opposed to not being captured and doing your job normally - is a rather strange incentive system."
The move came as members of the released crew continued to pay tribute to the four British soldiers killed in Iraq on the day they flew back to the UK.
Royal Marine Corporal Dean Harris from Trevaughan, south Wales, said the deaths in Basra meant he was finding it hard to take part in homecoming celebrations.
"It's so difficult to be ecstatic at a time like this because four soldiers have lost their lives," Cpl Harris said.
Leading Seaman Turney's parents, Alan and Rosalind Boswell, also said their thoughts were with the families of those killed.
In a statement, they also thanked the government, diplomats, the MoD and the Royal Navy who all helped secure the release of their daughter.