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The Netherlands has suspended an aid budget worth $6.15m (£3.9m) to Rwanda over its alleged backing of rebels in the Democratic Republic of Congo.
It comes days after the US announced it was cutting military aid to the country.Rwanda has rejected reports made by UN experts that it is supporting the M23 movement rebels in eastern DR Congo.
The rebels mutinied from the army in April and some 200,000 people have fled their homes as a result of fighting.
The move comes as a senior UN official told the BBC that defecting Congolese rebels have confirmed that they were recruited in Rwanda.
On Thursday, the UN reported that its forces helped the Congolese army push the rebels out of two towns north of Goma using helicopter gunships and armoured vehicle.
Judicial system The BBC's Anna Holigan in The Hague says this is the first financial sign that President Paul Kagame may be losing some of his European allies.
The Dutch foreign ministry has confirmed it will no longer be making payments to Rwanda's aid budget until it has received reassurances from Kigali.
The money was being used to improve the country's judicial system - Dutch support for non-governmental organisations will continue.
Our reporter says the Dutch government is still awaiting a response from Rwanda and is now in the process of talking to other European government about possible further action.
