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U.S. Army microgrants help revive small businesses

But soldiers say the program taxes platoon resources – meaning that recipients are often not held accountable for the grants.

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When US Army Capt. Nick Piergallini appeared in Hassam Jabar Kareem's appliance shop in Baghdad and offered him $1,000 to do whatever he needed to improve his store, the Iraqi businessman was understandably skeptical. "This is weird. Someone comes into my store and offers me money," says Mr. Kareem, who is considering closing his shop due to poor sales.

Captain Piergallini is participating in one of the US Army's latest reconstruction efforts: microfinancing. Although the microgrants doled out through program are turning around a number of businesses across Iraq, many soldiers worry that the program taxes combat resources while providing only limited oversight.

"Our end state at the local level is goods and services for Iraqis, provided by Iraqis, and these microgrants really help us accomplish this," says Maj. John Gossart, executive officer for the 3rd Brigade Combat Team (3BCT).

Instead of targeting major projects like roadways and electric pylons, microgrants help small businesses. The recipients are not expected to pay back a single dinar, but if they don't follow through with their plan, the US military can detain them or force them to pay the money back. No one involved in the program is aware of such an incident, though.

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