To provide more money than is needed or expected for something.
Overfunding can be a good thing if it helps people, but it can also be a waste of money if it's not needed.
Examples:
We don't want to overfund the project.
The school was overfunded and had extra money to spend.
The government decided to overfund the healthcare system.
I accidentally overfunded my piggy bank and now I can't get the money out!
They overfunded the party with so much cake that there was some left over for days.
The charity overfunded the animal shelter, so they had enough food and medicine for all the animals.