USAID Iraq Tijara Project

Developing MSME capabilities in the Iraqi banking industry


2009 - 2012


USAID is a United States federal government agency primarily responsible for administering civilian foreign aid.


Establish the potential for micro and small enterprise (MSME) lending in Iraq by creating demonstration lending units within four banks, sharing best practices and creating a market-driven approach to small business banking.



Deployed $25 million in profitable MSME loans within 12 months, from four major Iraqi commercial banks’ own capital.

Developed four full-scale SME lending units encompassing 26 branch sales and service centres across Iraq.

Trained and mentored a cadre of over 100 Iraqi SME portfolio managers, loan officers, risk managers, and other key personnel to support sustained success of SME business units within partner banks.


Over 2,000 Iraqi small and medium-sized enterprises accessed needed investment capital for enterprise growth and profitability.

Two partner banks committed to self-investing to expand their MSME business units, ensuring sustainable access to finance for unserved MSMEs across the country.


Conducted the Executive Bank Management Leadership Seminar, designed to train senior bank managers of several Iraqi private banks on the MSME segment, its viability and international best practices.

Created a training series for bank managers on a variety of issues related to MSME lending in order to help strengthen MSME lending capacities.

Set up MSME demonstration branches in each bank which included: 1) segmenting and researching the MSME market; 2) establishing policies and procedures for MSME lending; 3) strengthening portfolio monitoring and risk management practices; 4) resolving critical deficiencies in each bank’s MIS/IT system; 5) launching and marketing new loan products; 6) institutionalising bank-wide changes to all credit functions.

Defined national roll-out strategies for full MSME business lines for four major commercial banking partners.


Enclude faced two significant challenges and learnings in this program. The usual challenge of demonstrating viability of a long-unserved enterprise segment historically viewed as too risky was compounded by a very dynamic and fluid political and security situation which prevented local and international advisors from working in the field alongside bank counterparts on a regular basis. We successfully addressed both challenges by taking a staged approach, first convincing executive managers and leaders on proven international approaches to viable SME banking business lines through roundtables and briefings. This was followed by sustained, reinforcing classroom-training for branch managers and loan officers that was led by experienced practitioners in Arabic. Lastly, we embedded long-term advisors in “demonstration branches” located in more accessible markets and scheduled rotations for lending personnel to receive hands-on mentoring and experiential training with a “live” loan portfolio. This approach opened the way for continued investment by bank leadership, and established a foundation for additional external investment by multi-lateral and bi-lateral finance institutions and private fund managers.

Baghdad and Erbil, Iraq