The US will contribute an additional $2.25 million to support people displaced by the Sri Lanka conflict as they return to their homes and villages in the country's north.
The money will enable some 9,000 families to receive the shelter cash grant provided to returning families by the Sri Lanka office of the UN High Commissioner for Refugees (UNHCR), a US embassy statement said.
The shelter cash grant of 25,000 rupees ($220) "is a modest but integral part of returnees' return packages", the statement said.
"Many returnees have used the grant money to purchase bicycles, which allow them to access services, transport goods, and re-establish social ties.
"Some families have used the money to clear land for agriculture or to start up small businesses."
UNHCR, with US assistance, has provided over 50,400 families with shelter cash grant since the programme began in October 2009. But funding constraints have threatened the programme's continuation.
With the addition of this $2.25 million contribution, the US would have provided more than $33 million in humanitarian assistance to Sri Lanka since October 2009.
The Sri Lankan military crushed the Tamil Tigers in May 2009, enabling the start of the process to reconstruct war-battered areas.