The Scottish Borders Loan Fund, set up in 2012 to help small businesses, has been extended until October.
The fund, operated by Scottish Borders Council, was due to be wound up on March 31 and replaced by a Scotland-wide loan body.
But councillors heard this week that the Scottish Government had experienced difficulties with Euro funding for the initiative and its launch had been delayed
Since being set up, the local fund has provided interest-free loans of up to £20,000 to 12 applicants. To date, there have been no repayment defaults.
The fund currently has an available balance to disburse of £168,000.
The extended scheme will be promoted through the Business Gateway advisory service.