The government has withdrawn funding from the Belfast-based Rape Crisis Centre.
The centre works with victims of rape and sexual abuse
However, the Department of Health said funding for services to victims of rape and sexual violence would continue.
It said the £60,000 previously given to the centre will now be given to the health boards.
The department said despite receiving practical and financial support, the centre continually failed to meet government accounting requirements.
The government is now considering setting up a sexual assault referral centre in Northern Ireland.
Rape Crisis spokeswoman Eileen Calder said the centre had the support of "every political party in Northern Ireland".
"We have talked to both professional and political people and all have agreed that this is red tape, bureaucracy and nit-picking on behalf of the department," she said.