The cash is being offered for the first time by Oakham Memorial Institute, which owns a building on the corner of High Street and Gaol Street in the town.
The charity was established in 1923 using money collected to build a war memorial at All Saints' Church.
But the appeal was so popular that enough money was left over to buy the Gaol Street building.
Now the trust plans to use the income from the building to help people in and around Oakham, which will fulfil its original purpose.
Since 1923 The Memorial Institute building has served many purposes, providing accommodation for organisations including the WRVS, the Red Cross, the library, Oakham Urban District Council and Oakham Town Council. It is still home to the Citizens Advice Bureau.
The charity is now run by 12 trustees representing the Armed Forces, local churches, young people, local voluntary organisations, local residents and the Oakham Town Council.
Chairman of trustees Patsy Clifton said: "The money could be used for anything from setting up a youth club to paying for someone to take part in an activity or even buying someone a new television.
"Just come and ask us because the worst we can do is say no, but we may just say yes."
Secretary and treasurer of the trust is Richard Adams and the grant aid scheme will be coordinated by one of the trustees, Jan Fillingham.
Grant aid up to a maximum of £2,000 will be considered for ex-service personnel and their dependents, facilities for the frail and elderly and for the young, for recreational and leisure facilities, for community support and worthy causes.
It is available for individuals or organisations in Oakham or the adjoining parishes of Barleythorpe, Braunston, Brooke, Burley, Egleton, Gunthorpe and Hambleton. About £7,000 will be handed out each year.
l For application forms and further information about the grant scheme please contact Jan Fillingham, 37 Brooke Road, Oakham, Rutland LE15 6HG Tel: 01572 756706