Funding has been made available to Fife Council to support businesses and homes in Cupar flooded as a result of Storm Gerrit, which swept across the area in December.
The Scottish Government had been previously criticised for the delay in making a decision on the cash compensation.
Eligible businesses will receive £3000, while households will get £1500 on the same basis as the support provided to the worst affected by Storm Babet.
The Scottish Government is working with Fife Council to finalise details of the application process and eligibility, and further details will be made available as soon as possible.
First Minister John Swinney confirmed the move in a letter to Lib Dem MSP Willie Rennie.
In his letter, Mr Swinney said: “I can assure you that Scottish Ministers take the issue of flood resilience and the impacts on local communities very seriously.
“We know that in the face of climate change improving flood resilience is one of the largest adaptation challenges we face.
“Responsibility for flood resilience is primarily that of the occupier of a property, and then for a Local Authority to consider community level resilience.
“It is only in extreme cases where local resources have been exhausted that the Scottish Government will provide support. We are developing a Flood Recovery Framework to add greater clarity to when the Government will provide support around flooding events.
“In the particular case of Cupar, you will be glad to know that I have instructed my officials to work with Fife Council to provide the same level of support as was provided for those residents and businesses impacted by Storm Babet.”
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