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E-commerce business has been expanding fast in the country over the years riding on the ever-increasing internet facility, sector insiders said.
The size of e-commerce market crossed the Tk 17.0 billion-mark in 2017 from Tk 4.0 billion in 2016, according to the data available with e-Commerce Association of Bangladesh (e-CAB).
E-commerce started its journey in the country few years back.
E-commerce business has an immense potential to grow in the country if existing problems are addressed properly, the sector insiders said.
Sector players do not have access to bank loans against websites. Banks have not yet recognised any intellectual property like a website as an asset, they added.
Besides, e-traders are yet to get trade licences and expand their e-commerce business to rural areas, they said.
Despite challenges, the highly potential sector has been able to attract foreign direct investment (FDI) for providing online-based trading facilities.
e-CAB general secretary Abdul Wahed Tomal told the FE that the market size is expected to reach Tk 70 billion (Tk 7,000 crore) by 2021.
The draft of the e-commerce policy is now ready. It will be sent to the cabinet for its final approval.
E-commerce is yet to reach the grassroots level and that is a major hurdle for this sector right now, he added.
Big players are yet to make investments in this sector, the secretary said.
e-CAB is arranging seminars, discussions, and training programmes aiming to expand the market, Mr Wahed said.
As of 2016, a total of $50 million was invested in the sector. Of the total, $10 million came as FDI.
But the amount would be much higher as Chinese e-commerce giant Alibaba had recently acquired leading online marketplace Daraz.
Retail e-commerce is growing at 72 per cent a month.
The customers are now mostly from Dhaka.
They constitute 60 per cent and belong to the age group of 18 to 35.
All high-end products like mobile phones and accessories, fashion to diapers and digital services are available online.
Prof Dr M Rokonuzzaman told the FE that the e-commerce sector in the country largely depends on the 'cash on delivery' mode of payment.
It accounts for 90 per cent of the total transactions, added the professor teaching at the Electrical and Computer Engineering Department of North South University.
The remaining 10 per cent payments are made through mobile financial services (MFSs), he added.
Credit or debit cards or digital wallet could make the cash-on-delivery system easier, he observed.
He also said net neutrality, high-speed net, parcel delivery logistics and assurance of quality products are the key challenges for the e-commerce market in Bangladesh.
Entry of big foreign players into the market poses a risk to local start-ups, he said.
All the banks do not support the online payment gateway system. But some banks have introduced the system, the sector insiders said.
As many as 35,000 people are now involved with this sector.
Ten leading companies -- both foreign and local -- are present in the online market.
They are Daraz, Pickaboo, Kiksha, Ajker Deal, Bagdoom, Priyoshop, Shadmart, and Backpackbang.
Of them, the market share of Daraz is estimated to be 40 per cent.
Leading retail companies are Sheba.xyz, handymama, Bikroy.com, Sindabad, Easy.com.bd , Flight Expert, Gozayaan, chaaldal, Meenabazar, Shwapno, Directfresh, Khaasfood, Hungrynaki, Pathao food, and foodpanda.
Currently, 25,000 small and medium enterprises (SMEs) are involved with this sector.
The numbers of e-commerce websites and F-commerce pages are 2,500 and 150,000 respectively. The number of delivery is estimated at 15,000 to 20,000 at the retail level per day.
E-commerce in the Asia-Pacific is booming with 71 per cent of APAC consumers making online purchase. But one in five customers is falling prey to fraud, said a Media OutReach release on May 16.