Bangladesh’s digital commerce industry is gaming forward on the back of the following growth drivers:
Strong Economic Vitals for Tech Products and Services
Despite the pandemic, Bangladesh till Sep 2020 has clocked a GDP growth rate of 5.2% (ADB, 2020) – one of the highest in Asia – much ahead of South Asia’s average growth rate of -6.8% or compared to India’s -9% or Sri Lanka’s -5.5%. Majority of the population of Bangladesh are young and tech-adaptable, where 62%+ are under 35 years. The Middle class is growing at 10% per annum to reach 34 million by 2025. Increasing adoption of digital services with 110Mn+ internet users (95% on mobile devices), 40Mn+ on smartphones (BTRC & GSMA, 2020).
Growth in Digital Transaction Embracement
Digital services in the financial sector are slowly expanding. The Covid-19 pandemic has added momentum to them. Private banks have scaled up their digital services during the pandemic. As part of digitization, each bank has to launch e-KYC system by December 2020. The first three quarters of 2020 saw U$ 65 Bn+ transaction with 72% of the market dominated by mobile banking. With 96Mn Registered users and U$ 202Mn daily MFS transactions, digital transactions will unlock the digital commerce industry’s potentials.
E-Commerce Market Grows at a Steady Pace reaching USD 2.1 Bn
All online-based platforms that mainly retail everyday essentials have experienced remarkable business growth during the pandemic, shooting the eCommerce market (including f-commerce) at a steady pace to U$ 2.1Bn in 2020. The sector has connected 1,200 e-commerce companies, 60,000 SMEs (35,000 individuals; 25,000 enterprises), among which are 2,000 web-based and 50,000 active f-commerce merchants. In the next five years, the country’s e-commerce sector can create around five lakh jobs and holds the potential to be a key driving force of the economy.
Pandemic propelling Digital Transformation in all sectors
The COVID-19 pandemic has undeniably altered consumer buying behavior, wherein traditional retailing has taken a back seat. An exemplar shift towards a more digitized world is evident, with prompted changes in spending habits are likely to have long-term ramifications. High priority sectors poised for growth and digital transformation in the coming decade show early promises, including Pharmaceuticals, Agriculture, ICT/ITES, Logistics, and Digital Financial Services.
Can the Digital Commerce Industry become a critical driving force of the future economy of Bangladesh?
LightCastle Partners presents “Digital Commerce in Bangladesh: Policies & Possibilities”
1. Bijon Islam, CEO, LightCastle Partners
2. Mehad ul Haque, Project Manager and Senior Business Consultant, LightCastle Partners
3. Silvia Rozario, Project Manager and Senior Business Consultant, LightCastle Partners
|To learn more about the Digital Commerce Landscape of Bangaldesh