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eCommerce in Numbers Internet penetration (% of population with 2016, April: 38,5 % (62.004.000 users (Source: BTRC: Bangladesh internet access) Telecommunication Regulatory Commission) out of a population of approximately 161,000,000 (Source: BBC: Bangladesh Bureau of Statistics) Smartphone penetration (% of population with smartphone) Currently 18-23 % (Varied Sources including AMTOB, BMPIA, 3rd party analysts) With an annual growth rate of 30% (Source: eCab) eCommerce market as percentage of total GDP In Real GDP terms less than 1%. However if connected industries (for example imports, logistics, banking and exports through ecommerce taken into account it nears 2.5%) (Source: eCab) Annual growth in the eCommerce sector Aggregated growth for the past three years trending at 200%+ year on year. Growth is calculated by e-CAB in three strata. 1. Growth in eCom Businesses, 2. Growth in Consumers and 3. Growth in Transactions (Source: eCab) Annual growth in mCommerce mCommerce is not separately calculated in Bangladesh. Convergence in mobile technology has blended e-commerce and m-Commerce together. However if Mobile Value added service is taken as a part of mCommerce, the collective impact in all telco earnings is around 10% from mVAS. This in turn adds around a further 1% impact on GDP. mCommerce growth in mVAS and spillover of eCom stands at around 100% year on Year. (Source: eCab) Number of online shoppers A Large portion of eCommercce trade is still done through Cash on Delivery (CoD). As a result a calculation of online shoppers is challenging. Estimates suggest that the Number of Online Shoppers in 2015 is between 3 and 5 million Bangladeshis. (Source: eCab) The market was growing by 15% to 20% in 2014 (Source: Jahangir Shah, Online shopping increases, Prothom Alo, 2014-12-29.) Market share for eCommerce for B2B vs. B2C Average spending per online shopper 10% B2B, 90% B2C (Source: eCab) Average is BDT 900-1000 Or USD 11-13 (Source: eCab and BASIS) VAT-rate on eCommerce Currently VAT is exempted for the financial year (which was set at 4% in the national budget). However, this exemption has happened for the past two financial years. (Source: eCab and BASIS) Specific rules regarding company establishment in relation to online export No specific rules. However there are encouragement clauses in setting up online export companies in Bangladesh. Including these components: - Tax holiday Income tax holiday on Foreign employees Discounted infrastructure Accelerated repatriation of dividends through BoI Accelerated registration through BoI and RJSC Tax exemption on import of machinery (Through Hightech park Authority) Special IT zones as Hightech Park Authority You do not need to set up a company in Bangladesh in order to remit regularly. But Bangladeshis credit cards can only remit a total of 3000 USD a year in multiple transactions for software or ICT services. A Bangladeshi company can also remit outside of the country if it becomes a BASIS member and applies for a special purpose card which has a transaction limit of 5000 USD (the company can notify BASIS and get card reactivated when the limit is reached). (Source: eCab and BASIS) Key eCommerce platforms E-commerce Food Delivery platforms have increased in the last couple of years. Foodpanda and HungryNaki are the two of the biggest online food delivery companies. Online grocery shopping is also a growing platform; Chaldal and Direct Fresh. Other big platforms in different categories are: Muktobazaar.com, banglamart.com, sohojshopping, Ekhanei.com, Bikroy.com, DekheKinun.Com, Lamudi, Carmudi, Kaymu, rokomari.com, webbangladesh.com, haatbazar.com, number1shop.com, bdbazar.com, bengalcommerce.com, sonarmarketplace.com, upoharbd.com, bdgift.com cellbazaar.com, Biponee.com, Kiksha.com, Shohoz.com, Bdtickets.com, Nijekini.com, Daraz.com, Lamudi.com, pBazaar.com, pharmaquik.com, epharma.com, AjkerDeal.com, PriyoShop.com and Bagdoom.com. Many of the E-commerce platforms do have a Facebook platform where most of the transactions are done through. (Source: BASIS and eCab) Logistics – Key logistic and distribution operators in the eCommerce market Bangladesh Post office (BPO), Sunderban Courier Service, Continental Courier Service, SA Paribahan, e-Courier, Aramex, TNT, 4Star, 5Star, ELS (Source: eCab, BASIS) Key product categories in the eCommerce market The products and services that now dominate the country’s e-commerce are tickets (railway, domestic air), hotel booking, electronic products (for household, phones), books, jobs, clothing, food items, baby consumables and financial services. Types of payment Overview: Cash on Delivery Mobile Banking o bKash o SureCash o IFIC Mobile Banking o Dutch Bangla Mobile Banking o UCASH Visa or Master Card American Express Card Payza Paypal (http://bit.ly/29W6IEh) (Source: BASIS) In Bangladesh the most popular payment method regarding e-commerce is cash on delivery (CoD) which count for 90% of the spending behaviour (however logistic partners are now providing escrow as well as a formalized cash carrying semi automated system). Furthermore, the second major form of payment is MFS (Mobile Financial Service). All Major Card switches are also available (Visa, Mastercard, American Express, Diners Club etc). eBanking is also seldom used. IT exporter (from Bangladesh) can use Export Retention Quota (ERQ)/Foreign Currency (FC) account with bank to pay subscriptions of any software tool/system. Bangladeshi credit cards can remit total 3000 US Dollars a year in multiple transactions for software or ICT services. (Source: eCab) Return policy/ Consumer rights In substance, there are many gaps in the law (the Consumer Rights Protection Act, 2009 in Bangladesh) (Source: Consumers International). It is seldom invoked and put into practice (Source: eCab).