In 2022, with funding from the U.S. Department of State’s Bureau of Near Eastern Affairs, FSVC launched a program to strengthen micro, small and medium-sized enterprises’ (MSME) reforms, opportunities and growth in Iraq.  FSVC is implementing this program in partnership with Takween Accelerator, a local business accelerator located at the American University of Iraq in Sulaimani.

FSVC’s program tackled the following three objectives:

1) Improved the legal and regulatory framework for MSMEs:  FSVC worked with the Government of Iraq to simplify the business regulatory framework and strengthen the quality of public services to MSMEs, with a focus on business registration.

2) Increased access to finance for MSMEs:  FSVC and Takween Accelerator worked with public and private stakeholders to strengthen the financing ecosystem for MSMEs.

3) Strengthened the MSME business support ecosystem:  FSVC and Takween Accelerator built the capacity of Business Support Organizations (BSOs) and individuals who supported MSMEs so that they can in turn provide better services for their MSME members to grow and expand their operations.

Program Impact

Streamlined Business Registration:

  • Supported the implementation of a one-stop-shop approach to business registration, resulting in the implementation of an online reservation system to reduce wait times.
  • Helped the Iraqi Office of Company Registration create a toolkit for their MSME customers to help them understand the business support tools and resources available to them.
  • Established a dedicated customer service department in Iraq’s Office of Company Registration, including a media unit, to improve service delivery and enhance communication with MSMEs.

Enhanced Access to, and Quality of, Business Support Services:

  • Trained a cohort of local business coaches in financial management, startup financing, and communication mentoring for MSMEs. The cohort is now creating a local business association to enhance service provision to MSMEs. Several coaches have already used FSVC workshop materials to train and coach over 200 local business owners.
  • Established a new entrepreneurship unit within the Federation of Chambers of Commerce, operating across all Iraqi governorates, with the participation of the FSVC-trained MSME mentors. The FCC will provide monthly capacity-building training to MSMEs and will focus on available funding sources, valuation tools and investor pitching to equip MSMEs with the skills needed to secure funding.

Diversified Financing Solutions for Small Businesses:

  • Trained 82 financial institution staff on increasing access to finance for MSMSEs, including assessing and managing their risk levels and credit worthiness. As a result of FSVC assistance, three banks upgraded their risk management system by incorporating a rating system.
  • Supported the creation of an SME Unit within the Credit Department of a major state-owned bank. FSVC developed a comprehensive action plan to guide the establishment of the unit, which will modernize the bank’s credit operations and MSME financing strategies.
  • Helped to facilitate the Shababna Project – a partnership between the National Bank of Iraq and Kapita Business Hub to support 400 MSMEs with comprehensive training, followed by zero interest loans and flexible repayment terms.
  • Assisted the National Bank of Iraq’s launch of a loan product for agricultural MSMEs, with a built-in financial technical assistance component to help MSMEs manage loan repayments. The agricultural loan has been disbursed to over 300 MSMEs in Mosul and Dohuq so far.
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