Community and third sector groups, as well as social enterprises, across Merthyr Tydfil, Torfaen, Caerphilly, Blaenau Gwent, Rhondda Cynon Taf and Bridgend will be among those receiving help.
The Community Economic Development Programme aims to encourage organisations to become less dependent on grants and better equipped to tender for procurement contracts.
The scheme is expected to create 119 jobs as new organisations are established and others are expanded.
The programme, led by Merthyr Tydfil County Borough Council in partnership with five other local authority areas, is backed with £9m from the European Regional Development Fund through the Welsh Assembly Government. Further funding will come from the local authorities and the social enterprise sector.
Announcing the funding, Social Justice Minister Carl Sargeant said:
“We are committed to strengthening the economy by creating and expanding social enterprises and third sector organisations in Wales. This investment is very welcome as it has the potential to enhance the quality of life and well being of people living in South East Wales.”
As part of the programme a range of business support services, such as mentoring, business planning and financial management, will be available to organisations.
The Leader of Merthyr Tydfil County Borough Council, Councillor Jeff Edwards said:
“We are delighted to host this excellent programme. The scheme will help to develop the third sector in the region by offering a range of funding and business support opportunities, whilst ensuring the programme compliments the other excellent support programmes available to the sector.”