"There's widespread dissatisfaction with the EU," said Joni Hillman, donor advocacy officer at Bond, which helps development charities apply for funding.
"I think people find managing this money incredibly hard. There's a feeling that it's unnecessarily complex."
Hillman said high levels of competition for the money, combined with a great deal of bureaucracy, were discouraging some charities for bidding for EU funds.
One charity worker who has obtained money from the EU for several different charities said it was "the worst funder I have ever dealt with".
The source, who wished to remain anonymous, said charities could face a wait of up to two years from submitting an application to receiving a cheque - and even then they faced problems spending the money.
"You have to be incredibly careful about how you account for cash," she said. "You have to account for details that are nearly impossible to supply, particularly for organisations operating in the third world."
Avila Kilmurray, chief executive of the Community Foundation for Northern Ireland, said she had seen small charities struggle with EU regulations.
"I've seen situations where organisations have had to wait years for the money, or where they've actually had to give money back after it's been spent," she said.
An EU spokeswoman admitted third sector organisations faced high levels of regulation and discussion when applying for grants.
"We have to be strict on our financial regulation," she said. "If you use taxpayers' money, you have to be highly accountable."