Northern Ireland political parties will soon have to notify the Electoral Commission about donations over £5,000.
However, donors' details will be kept confidential because of fears they could be intimidated.
Political Development Minister David Hanson made the announcement following consultation on the reform of donor funding and electoral registration.
The government also intends to proceed with plans to relax electoral rules requiring annual voter registration.
Donations to political parties has been a controversial issue for some time and Northern Ireland has been granted exemptions from UK rules for some time.
The new measures require political parties to notify the electoral commission about donations over £5,000 from 2007.
The identity and details of donors from the UK and Ireland will be kept confidential - although there is provision for full transparency by 2010.
Rules requiring annual voter registration were introduced to stamp out fraud, but led to a sharp decline in the register.
A bill is to be introduced, replacing the annual voter registration process with a system using information from public bodies to update the list on a regular basis.
Officials believe the information could be used to identify individuals who have not registered to vote and target them.
The bill would also extend the deadline for voter registration to 11 days
before polling day, subject to enhanced security safeguards.