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Most e-commerce firms run informally to avoid regulations

  • Staff Correspondent
  • 13 October, 2021 12:00 AM
  • Print news

Most of the e-commerce companies are operating informally using social media  platforms defying the government regulations, a senior executive of a trade body claimed.

“Most of the e-commerce companies slip from the watch list as 70 per cent of companies operate informally using social media platforms like Facebook,” Abdul Wahed Tomal, general secretary of the E-commerce Association of Bangladesh, said at a press meet on Tuesday.

E-Cab organized the press meet at Pan Pacific Sonargaon in the capital to raise awareness on online shopping as part of a month-long campaign.

The press meet by E-Cab came after a series of scams have rattled the industry, prompting the authorities to launch investigations. 

“Till now, 1,609 companies have registered with E-Cab. That’s maybe only 30 per cent of the total number of the e-commerce firms in the country. Around 70 per cent of companies are out of our network as most of them use Facebook to run their businesses,” he said.

Tomal claimed the controversial business models of eight to ten companies can’t represent the entire industry.

He said lack of infrastructural readiness is a major hindrance for the sector.

Earlier on July 04, the commerce ministry released a standard operational procedure (SOP) for the e-commerce sector as gazette.

For violating the regulations, the law enforcement agencies have arrested founders and executives of at least 10 e-commerce companies for alleged money laundering and frauds. The scam-hit e-commerce platforms include Evaly, Dhamaka Shopping, eOranage, Shirajganjshop, 24TKT.

Commerce Ministry on Sunday issued show case notices to four e-commerce companies – Tholey, Dalal Plus, Anander Bazar and Alashpar for running fraud campaigns.

In last week of August, the commerce ministry sought information from Bangladesh Bank about financial transactions of nine e-commerce companies – Alesha Mart, Dhamaka, E-orange, Sirajganj Shop, Aladiner Prodip, Qcoom, BoomBoom, Adyan Mart and Need.com.bd. The High Court (HC) will form a four-member board Wednesday for assessing the liabilities of controversial e-commerce platform Evaly.

On July 04, the commerce ministry unveiled standard operational procedure (SOP) for the e-commerce sector as a gazette.

“We are working together with the ministry to ensure transparency in the sector. We have taken action against the companies that defied regulations or the SOP. It is a continuous process. Besides, we also lack capacity in complaint management,” Tomal said in reply to a question about the softness of the trade body to a few e-commerce firms.

He said the trade body gave time to the scam-hit Evaly to restructure its business model considering the number of customers as the company tried to raise investment.

Regarding the lack of representation of industry representatives in E-Cab, Tomal said the trade body will hold an election ‘very soon’ to bring new faces to the executive body.

E-Cab President Shomi Kaiser said they are working with government agencies to improve the business environment for the e-commerce sector.

“We are working together with the commerce ministry to update the existing law tagged with e-commerce as new legislation may take time. Besides, different agencies like NBR want to work with E-Cab for addressing the challenges in the sector,” she said.

Fahim Mashroor, former president of Bangladesh Association of Software and Information Services (Basis), said local e-commerce companies are working together to restore the confidence of customers as some e-commerce scams have created negative impact in the sector.

Tech entrepreneurs including Pathao president Fahim Ahmed, Chaldal co-founder Zia Ashraf, Jachai chairman Abdul Aziz, Pikaboo co-founder Morin Talukder, Aadi chief executive Fatema Begum, Babycare Bangladesh chairman Khaleda Rownok and Bangla Shoppers chief operating officer Hasnat Jamil spoke on the occasion.