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The growth of the e-commerce industry in Bangladesh has been remarkable since the early 2000s. At that time, the country lacked sufficient internet access and a dependable online transaction system. However, in 2009, the Bangladesh Bank, the central bank, started allowing online transactions. Four years later, in 2013, the Bangladesh Bank also authorized the purchase and sale of goods and services online with international credit cards. Although Bangladesh ranks 147th out of 176 countries on the ITU’s ICT Development Index 2017, which measures the level of ICT development, the Bangladesh Telecommunication Regulatory Commission (BTRC) reports that as of December 2021, there are 123.82 million internet subscribers in the country, of which only 10.09 million have broadband connections, while the rest use mobile internet.
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Currently, the following four types of e-commerce are popular in Bangladesh:
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The growth of B2C websites, particularly online food delivery services, has seen a surge in popularity in major cities due to factors such as congested roads and challenging driving conditions. These conditions have led to a greater demand for home delivery services such as HungryNaki and FoodPanda. Other B2C ventures include platforms like Shoprbd and ShoptoBd, which are built on Facebook and provide customers in Bangladesh with access to top online shopping sites from countries such as the US, UK, India, and China.
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Many B2B websites in Bangladesh specialize in offering manufacturing and supply chain services. For example, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and several large garment companies have adopted B2B e-commerce platforms for their international ready-made garment (RMG) orders and procurement. Additionally, there are B2B websites that serve as business directories, showcasing trade deals and information about suppliers, such as the Bangladesh Business Guide, Address Bazar, and Bizbangladesh.
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The growth of cross-border e-commerce is hindered by a lack of a reliable online transaction system and restrictions on the flow of foreign currency for consumer purchases. The limited logistics infrastructure and inconsistent customs procedures also present challenges. Despite these obstacles, DHL, a leading logistics company, has announced its intention to invest in cross-border e-commerce in the future.
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Cash transactions are still the predominant financial transaction method for the majority of the population. According to research by the e-Commerce Association of Bangladesh (e-CAB), more than 90 percent of e-commerce users in Bangladesh prefer the cash-on-delivery payment model. Most e-commerce business portals in Bangladesh have integrated merchant accounts to facilitate credit card transactions. However, almost all e-commerce websites also offer multiple other payment methods and still cater to the consumer-preferred cash-on-delivery system. Very few e-commerce businesses operate on the system of only delivering the product after receiving payment through a wire or bank transfer.
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In a 2017 report, e-Cab said Bangladesh has 99 percent geographical coverage for voice and data connectivity. The Bangladesh Telecommunication Regulatory Commission (BTRC) puts total internet subscribers at 117.3 million as of May 2021, of which only 9.8 million use broadband connections while the rest are mobile internet users.
Mobile bill payment and remittance transfers via mobile phone were introduced in Bangladesh in 2006 and 2010 through the country’s leading mobile operators and banks and have become very popular. The government also authorized mobile operators to sell railway and bus tickets and tickets to cricket matches organized by the Bangladesh Cricket Board using mobile phones.
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Many Bangladeshi customers prefer to pay in cash on delivery to ensure they are receiving the product promised. Shoppers tend to buy more during the major Muslim holidays of Ramadan, Eid ul-Fitr, and Eid ul-Adha. Hindu, Buddhist, and Christian holidays, including the Buddhist New Year, Durga Puja, and Christmas, respectively, are also observed by segments of the population. Other major Bangladeshi holidays include Bengali New Year (April 14), Independence Day (March 26), and Victory Day (December 16). Some of these holidays are based on a religious calendar, and specific dates depend on lunar sightings.
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The present system of trademark protection lacks a sufficient legal framework to protect intellectual property rights and opens the way for those ready to engage in unscrupulous business practices.
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Social media is widely used in Bangladesh. Facebook is the most prevalent of social media platforms, with more than 30 million users. Facebook is used to engage consumers and is also a major e-commerce platform. There are over 50,000 e-commerce Facebook pages in Bangladesh, many of which are small businesses using Facebook alone to advertise and sell products ranging from clothes to beauty products to food. With faster internet connections, Google cache servers, and better streaming, YouTube is also gaining popularity in Bangladesh.
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