The town's sub-branch, along with hundreds of other groups throughout the state, were forced to stop fundraising following a financial scandal at state level two-years ago.

Cootamundra RSL Sub-Branch secretary trustee treasurer Jacqui Vincent OAM said the members of the local group have been extremely grateful that the fundraising freeze has finally been lifted.

"This allows us to get back to fundraising and for the sub-branch to survive," she said. "We had to rely on not being able to fundraise during the ban and rely on the money in investments."

Going on from here, the sub-branch must apply to the state's Fair Trading Department to resume its normal fundraising activities. Despite the two-year ban, she expects the community will show their support.

Ms Vincent said fundraising was not just about raising money, but showing the community the support systems available for ex-servicemen and women.

"It is extremely important to let people know we are here, not only for our older veterans, but for our younger generations coming back from service," she said.

The state's RSL president James Brown said the two-year ban was needed to protect local volunteers after it was made clear the charity was facing an issue with fundraising compliance.

"There was very little data available to the new RSL leadership that showed the extent or nature of fundraising at a local level - it took nearly a year to collect that information from our sub-branches," he said.

"The restriction was necessary to protect our hardworking local volunteers from unintentionally breaching the law and risking hefty fines or, in the worst case, a criminal penalty."

Mr Brown said that lifting the ban was a part of state-wide reforms to help restore community trust in the iconic veterans' charity.

He said the sub-branches are now free to apply for fundraising approval and get back to normal business of raising money for veterans and their families.