The Scottish Government's Community Regeneration Fund, set up to help rebuild communities in deprived areas, will be replaced by the Fairer Scotland Fund. Charities say many projects currently in receipt of funding will not be eligible for the new fund and will have only three months to find more funding.
Shulah Allan, head of the Edinburgh Voluntary Organisations Council, said 90 projects in the city could close. "The fund will use single-outcome agreements, for which projects must have a defined goal, but many of these projects are about continuous processes," she said.
Alison Blake, project manager at Dundee Business and Community Link, said it would close and that she knew of 20 other affected projects in Dundee.
A spokesman for the Scottish Government said the new fund would cut bureaucracy and free local government to spend as it saw fit for the benefit of communities.