The country’s e-commerce sector will see a sustainable development if the government, regulators and stakeholders intervene, speakers said at a Dhaka Chamber of Commerce & Industry (DCCI dialogue on Saturday.
In 2020, e-commerce transaction in Bangladesh stood at about $2 billion, which is likely to increase up to $2.5 billion this year, according to an estimate.
DCCI organised the dialogue titled: “Building a Sustainable Ecosystem for Ecommerce” at a virtual platform.
Transparent automation, easy regulations, access to finance and easy tax structure are key to flourishing e-commerce in Bangladesh, speakers suggested at the dialogue.
Inter-ministerial coordination and cross border digital commerce trade facilitation will also help further development of e-commerce, they added.
In 2020, transaction in only f-commerce sector was about Tk 3.20 billion, but the 15 percent VAT imposed on e-commerce may hamper the growth of small investors in this sector, apprehend business leaders.
If international market leaders like Amazon come in Bangladesh market, it may create opportunity for local CMSME traders and manufacturers, according to DCCI president.
“The government does not want to impose strong regulations upon the sector so that small entrepreneurs can come on board easily,” he assured, adding that government is working hard to create a congenial regulatory atmosphere for ecommerce business.
He suggested for a coordinated platform to overview compliance issues, observing that the recent introduction of Escrow system to see the compliance has the number of e-commerce transaction fell.
At the same time, he also requested the consumers not to be greedy or discount hunter. The government will review the consumers’ protection law in line with the e-commerce regulations.
Barrister KM Tanjib-ul-Alam, Head of the Chamber, Tanjib Alam and Associates, also underscored importance of reliability for a sustainable market.
For sustainability, repeat customers are needed and depending on only discount hunter and for a few opportunists, the market may be hampered.
He urged for a proper policy and guidelines with a scope of reward and punishment. The government should come forward to safeguard the ecosystem, he added.
“The government should upgrade the national postal system so that ecommerce platform can utilise this trusted system. Moreover, we need to prepare our law enforcing and related agencies to make them aware of fraudulent in this sector. Lastly he urged for a complete data protection law,” he said.
Fahim Ahmed, President, Pathao said policy and regulatory guidelines are needed for a sustainable ecosystem. Unsuccessful ecommerce platforms with a huge liability and discounting method cannot sustain in the market as it is not economically viable.
The short term investment and huge discount-giving model may create a bad name to the industries, he feared.
Khorshed Anwar, Deputy Managing Director, Eastern Bank Ltd said small e-commerce, startups or f-commerce entrepreneurs are sometimes deprived of access to finance due to lack of documentation.
Khondoker Tasfin Alam, CEO, Daraz Bangladesh, said excessive discounting model is not sustainable. Customer readiness as well as seller’s readiness is equally important.
Sometimes wrong model can become famous for the time being but it is not sustainable but will hamper the ecosystem.
Ashish Chakraborty, Chief Information Officer, Nagad said Mobile Financial service plays a vital role in ecommerce as customers from rural area can get products from anywhere in the country using mobile wallet.
Bangladesh Bank now allows to get small investors having NID onboard which is a good move, he told. For the growth, he emphasised on full automation of this sector and this system will ensure service delivery information.
Muhammed Abdul Wahed Tomal, General Secretary, e-CAB, said that the e-commerce sector in Bangladesh has got a tremendous growth right at this moment which was supposed to come in 2030. The growth momentum came at a faster rate due to Covid.
Ecommerce is an integrated sector and agencies like Bangladesh Bank, NBR, LGRD, Commerce Ministry, ICT Division all are involved.
Regarding Escrow service, he suggested making it more automated and easy functioning. All the regulations should come under one umbrella in a combined manner, he suggested.
He also underscored the importance of data protection to create confidence in the market.
He expected that through the ecommerce sector, cross border digital trading will be a billion dollar industry in future. At present around 5 to 10 lakh f-commerce entrepreneurs are in operation in the country, he informed.