Some of the organisation's key personnel have links to the UDA.
Speaking on Sunday Politics, Emma Little Pengelly, an architect of the fund, said she was satisfied a robust process of checks was carried out.
BBC NI's Spotlight programme last week examined the control the UDA exerted in some loyalist communities.
It also looked at how funding from Stormont was going to organisations linked to the UDA.
Traditional Unionist Voice leader Jim Allister has also questioned the allocation of social investment funding to groups with loyalist and republican links.
However, Ms Little Pengelly said: "There is a system of checks and balances and there were concerns about how quickly this scheme delivered.
"One of the reasons why it wasn't quick was because of the number of checks and balances included in terms of getting this money out.
"They have gone through a full business case, economists, the governance has been scrutinised.
"If we weren't satisfied by that, then this money would not be going out to this organisation."
Chris Lyttle of the Alliance Party, said the social investment fund had been "beset by a lack of openness".
"There have been difficulties from day one in relation to the programme," he said.
The chair of the assembly's finance committee has defended the allocation of almost £2m of social investment funding to Charter NI.