The government's Connection Voucher scheme has been suspended to new applicants, amid ongoing funding concerns.
Successful applicants, mainly small businesses, received grants worth up to £3,000, with the scheme covering 50 cities across the UK.
The idea was to give an increased number of smaller firms access to superfast broadband (30 Mbps) and was initially given backing of around £100 million from the wider Urban Broadband Fund.
The scheme was due to end in March 2014, but a further cash injection of £40 million extended the programme by another 12 months.
Having made the application process easier for firms outside city centres, the scheme had seen a marked rise in demand.
Last month saw just over 40,000 firms benefitting from the vouchers, a sharp increase from the 15,000 recorded in the first quarter of the year.
Reports already began to emerge suggesting that funding was becoming an issue, with the scheme turning down new applications from both London and Birmingham.
Now the Department for Culture, Media and Sport (DCMS) has confirmed the scheme is now no longer open to any new applicants.
A statement said: “The Connection Voucher Scheme is currently suspended. The funds available to the Scheme are close to being fully committed and we have suspended the scheme. Whilst the Scheme is suspended, cities will not accept applications.”
The government has not yet revealed whether extra funding will be made available to further extend the scheme.