E-commerce has experienced fabulous growth in early 2000. Though the landscape of e-commerce in Bangladesh has formed in the 2013-2014 timeframe. As in the 2000s, our country lacked access to the internet connection. Besides, a reliable online transaction system wasn’t available then. In 2009. The central bank of Bangladesh started permitting transactions through online banking. After that, the growth of the e-commerce business in Bangladesh really didn’t look back. In 2020, the e-commerce business in Bangladesh gained 166% growth with 2500 sites selling products worth $2.07 billion which is considered as 46th largest e-commerce revenue in the world.
Today the implementation of technology in every sector seems very common. You may not see any part of the world that is not implementing and utilizing technology at this time. Besides the e-commerce business is booming nowadays in Bangladesh because of people’s access to the internet and the consistent development of the web population. Especially in the last five years, the e-commerce business in Bangladesh has splendidly grown. You may barely see any part of Bangladesh is working with no utilization of technology. To be very specific, electronic commerce or e-commerce is the one and only internet platform that has opened a modern horizon of business. The modern e-commerce business is involved in providing customer service including online payment, delivery of the finished goods, marketing, creating identification, and other services. In Bangladesh, more than 33% of people use the internet among more than 165 million people.
In these last few years, the massive utilization of the internet has been seen. From 2017 until now we can see a very large portion of businesses are online based and proudly doing their business over a digital network. The web these days works as a medium and connects the general people of Bangladesh and the people of other countries with the companies. Actually, the e-commerce platform of our country had a high jump in 2017 as it developed by more than 70%. Also in 2017 against the retail market of 133, 571 cores the B2C e-commerce market added up to $110-115 million which is around 900 crore taka. In 2018, the population of internet users increased to 91.3 million and the percentage of penetration rate was 52.77%. In June 2019 the internet reached 96.199 million. In 2020, the e-commerce sector of Bangladesh has seen a 166% growth rate which is remarkable.
Currently, in 2021, there’re more than 2500 e-commerce sites and more than 1, 50,000 Facebook-based online business pages operating in Bangladesh. The number of orders people are placing is 50,000 per day. Among all these pages almost 80% operate online outlets from Dhaka, Chattogram, and Gazipur. It has been forecasted by the e-Commerce Association of Bangladesh or e-CAB that the market is about to reach taka 7000 core in 2021. Now the market size is $1 billion or 8,000 core Tk. The growth rate of the market is 75% per year.
Though the pandemic of COVID-19 seems to lock all the doors of the world, on the other hand, it opened new doors for e-commerce businesses in Bangladesh. The growth rate of the e-commerce business in Bangladesh during the pandemic has been remarkable. Because of COVID-19, the local shoppers are now doing their business online. Here online shopping increased by 70%-80%. Moreover, in 2021 the Muslims of our country has bought more than 1.05 lakh sacrificial animals which are worth about Tk 737 core online because of their religious festival Eid-ul-Adha. As a result, the e-commerce market of Bangladesh has exceeded $1.5 billion which shows rapid growth. According to the German-based research institute Statista, our country is expected to reach two billion dollars by the end of this year and three billion dollars by 2023. (Anon., 2020). Besides hundreds of entrepreneurial organizations, around 4 million female entrepreneurs are doing business on Facebook, Instagram, and other social media. So, you can see CoVID-19 really couldn’t prevent the growth of the e-commerce business in Bangladesh.
Due to the pandemic, where many businesses have fallen apart, others have grown stronger than before. For example, in the market of grocery retail e-commerce like Chaldal.com, Khass food, Meena Click, etc were kind of struggling before lockdown. But at the initial stage of lockdown, they received a huge number of grocery orders and after that, they really didn’t look back as their business became larger than before. The major food delivery service providers Pathao, Shohoz, Foodpanda also started to deliver grocery items during that time. Even the lifestyle e-commerce business platforms- Dara.com, Priyoshop.com, and Ajkerdeal.com, etc started taking orders for grocery items. The leading processed food manufacturer Aarong Dairy, Kazi Farms, Golden Harvest also started to provide home delivery as none go outside because of serious health threats.
Though COVID-19 has a devastating impact on the national and global economy, the e-commerce platform and online transactions, and online grocery stores have seen rapid growth, particularly double-digit growth. Other industries, except the e-commerce industry, have fallen apart. Some of them also diversify their service by making it related to consumers’ needs. But there’s a dark side to everything.
More than 11.48% of customers of the e-commerce sector were deceived last year from various e-commerce and Facebook commerce (f-commerce) websites. (Anon., 2021). In 2019, the number has been 7.44%. It has been reported under the Cyber Crime awareness foundation (CCA Foundation), this organization volunteers cyber security awareness. However, consumers are harassed in many ways while shopping from e-commerce sites including-
In a research, it’s also been found that the highest percentage of deceived customers was between 18 and 30 years of age, while 0.92% was under 18. The report also said that men are more likely to be deceived when shopping online. Among the cheated customers (11.48%), 7.38% of the victims were men and 4.1% women, the report found. (Anon., 2021). Here many are doing business without following the rules and regulations properly. Even a large number of e-commerce sites don’t have legal papers or trade licenses. Also, these illegal e-commerce sites are taking orders for non-existed products from their Facebook page. Hence, there’re many courier companies that are operating their business illegally.
In June 2021, the VAT intelligence wing conducted a raid at E-orange’s online office located in Gulshan, Dhaka. The VAT intelligence division has found that E-orange has evaded VAT worth thirteen lakh taka. As a result, they filed a case against this e-commerce site. They’ve also found that Eorange is selling their products on different online platforms but not paying the Vat properly against the commission they’re getting from sales. According to the documents that have been found at their office- the company has sold products worth Tk245.75 crore and received commissions worth Tk3.4 crore. (Anon., 2021). But The E-orange was supposed to pay VAT of Tk 19.39 lakh at the rate of 5 percent on the commission, but it had paid only Tk 6.23 lakh. (Anon., 2021).
The Bangladesh Bank has found a huge gap in the liabilities and assets of Evaly. They have records of cheating customers by taking advance and not delivering the desired products afterward. According to a report, Evaly did not deliver products against a cumulative sum of Tk 213.94 crore in advance payments from customers. Moreover, the company owes Tk 189.85 crore to the merchants from whom it bought products. (standard, 2021). Evaly seems to attract customers by conducting various terms of offers like – ‘Cyclone’ or ‘Earthquake’ offers. They also show that they’re giving products at more than 50% discounts. Evaly’s total number of customers as of 28 February in this year was more than forty-four million Including the cancellation of the purchase orders, the cashback is given by Evaly, and sold gift cards, an e-value to the tune of Tk73.39 crore was stored in Evaly’s virtual IDs (account, holding, gift card, cash back) of these customers. But at the end of that very day, Evaly.com Limited had a total deposit of Tk2.04 crore in its 10 bank accounts. (standard, 2021). They’re showing that Evaly sells products at huge losses.
The things these e-commerce sites are doing not only evoke unhealthy competition in the sector of e-commerce but also encourage other businesses to follow the same path. Because of their activities, the other e-commerce sites that are doing business legally tend to suffer a lot. At some points, the traders will lose confidence eventually. The incidents are more likely to impact the overall financial stability of the country.
The growth of the e-commerce business in Bangladesh has seen both ups and downs. If the government of Bangladesh truly wants to implement the vision of building a digital Bangladesh. Critical attention to the requirements and challenges need to be paid in this sector so that it can follow the national policies and eco-systems. By following that the e-commerce business in Bangladesh will develop and flourish.