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E-Commerce in Bangladesh

History of E-commerce in Bangladesh

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E-commerce is already quite popular in Bangladesh and it is only increasing. Compared to other countries of the world, E-commerce came at a later stage in our country but it grew very quickly.

E-commerce or Electronic Commerce is closely related to computer and Internet. If we have to talk about the history of E-commerce in Bangladesh then we also have to talk about the history of computer and Internet this region. In 1853, the British established telegraph service in India. After one hundred year Pakistan Telegraph and Telephone board was established. Radio came to Bangladesh in 1939. Television came in 1964 and Bangladesh got its first computer that same year. Atomic Energy Commission of Bangladesh brought the first mainframe computer IBM-1620. This model had transistor, magnetic disk and magnetic core.

Bangladesh Agricultural University was the first educational institution in the country to use and Radio Shack TRS-80 64K model computer. The model is still preserved in Agriculture Museum. Still then, the use of computer was very limited because of large size and higher cost.

Computer started to become popular in the late 1980s. The printing and publication industry embraced this technology. Publication cost decreased significantly.

Rise of computer in the 90s:

Throughout the 90s, use of computer only grew. Some of the major milestones of this decade were:

  • Internet came to Bangladesh in 1993. Initially, it was Unix-to-Unix Copy Protocol  (UUCP) e-mail.  They were replaced by Internet Protocol accounts in 1996.  In June, 1996 the government decided to allow private companies to act as Internet Services Providers (ISPs) using VSATs.
  • From 1996, Computer was also being introduced as a subject in secondary level education. Subjects like Computer Science, Computer Engineering became very popular. In addition, numerous organizations were offering short courses or one year diploma course.
  • In 1998, the then government of Bangladesh removed all types of tax and duty from computer.

Bangladesh Computer Council and Bangladesh Bureau of Statistics conducted a survey which revealed that there 780000 PCs in the country by the end of 1998 with more than 120,000 licensed software. Dhaka had the highest concentration of computer (72%).

Arrival of mobile phone:

Mobile phone came into the country in the 90s. Sheba Telecom was the first Mobile phone service provider but the service was very expensive. In 1997, Grameenphone introduced affordable mobile service. Since then the usage of mobile only continued to grow.

Beginning of E-commerce in Bangladesh:

E-commerce started in Bangladesh in the late 90s. The earlier E-commerce sites were actually gift sites targeted towards the Non-Residential-Bangladeshis (NRB) living in abroad. All the sites were based in abroad and had branches  in Bangladesh. NRBs would buy various products for their families or loved ones and pay in credit card. The site would then deliver the product to their family or friend in Bangladesh.

From 2000 to 2008 the E-commerce sector observed slow growth. There were few E-commerce websites but there were no system for online transaction which is the first condition for E-commerce. In addition, high cost of Internet and lower penetration meant that few people knew about these sites. According to Bangladesh Bank, payments and transactions by credit cards were nearly Tk11 billion in June 2008; one of the lowests in the world.

The country had only about  400,000 credit card holders at the end of June 2009. From 2008, things started to look bright as Bangladesh Bank took various initiatives including implementation of e-Payment Gateway.

Bangladesh Bank opening up E-commerce sector:

The real change came in 2009 when Bangladesh Bank allowed online payment in the country thus, officially opening up the E-commerce sector. In November that year, Bangladesh Bank issued a circular where it gave permission for following types of online transaction in the country:

• Online utility bill payment from client’s accounts to recipient’s accounts.

• Online money transfer from online of a client to his/her another account in the same bank

• Collection of money from/to buyer’s bank account to seller’s bank account for Purchase/sale of products under e-commerce system transaction via internet using credit cards in local currency.

Another major incident of 2009 was introduction of WiMax internet in Bangladesh. It became quite popular in the country.

Rise of Freelance Outsourcing:

After opening up online transaction, the outsourcing sector of Bangladesh observed rapid growth. In 2010, Bangladesh made it to the list of Top Outsourcing Country of GARTNER Inc. (www.gartner.com).

 

Elance and Odesk are the two most popular sites for freelancing jobs. Many Bangladeshi freelancers also use these two sites. In 2013, Bangladesh was ranked 7th and 8th on the list of 180 countries in Elance and Odesk. In 2012, there were only 2,42,268 registered freelancers from Bangladesh which increased to 3,62,948 in 2013. By the first quarter of 2014, Bangladesh has a total of 3,87,114 freelancers. Between 2010 and the first quarter of 2014, a total of 435, 249 jobs had been awarded to Bangladeshi freelancers.   SEO, WordPress, PHP, HTML, CSS, Data entry, MySQL, Internet research, social media marketing, and Adobe photoshop are some of the top paying skills for Bangladeshi freelancers.

Freelancers can now bring in money:

Seeing such rise of the outsourcing sector in the country, in August 2011, Bangladesh Bank issued a circular stating that Bangladeshi outsourcers can bring up to $500 at a time in the country through Online Payment Gateway Service Provider (OPGSP). The circular also said that the amount $500 will be increased further in future.

Payza:

However, bringing in money from online from abroad was quite hectic for the freelancers back then. Hence, Bangladesh Bank gave permission Online Payment Gateway Service Provider (OPGSP) to operate in this country. Under this initiative, Alertpay started its operation in 2012. Initially, Payza started as Alertpay. In partnership with Bank Asia and Casada Technology Alertpay showcased its service at BASIS Soft Expo 2012. Later, in October that year, the company rebranded as Payza for the name Alertpay was causing confusion among people. Within a week of its launch, Alertpay got 21,000 new members and continued to grow rapidly.

Year 2013: The Rise of E-commerce

The year 2013 has been an important year in the history of E-commerce in Bangladesh. Some important things took place during this year, that would have a long lasting effect in the E-commerce sector.

  • First, Bangladesh Association of Software and Information Services (BASIS) and Bangladesh Bank jointly observed E-commerce Week for the first time in the country.  From January 5 to January 11, there were four roundtable discussions, two seminars, one technical session, special awareness program at Dhaka University and a special promotional campaign at Bashundhara Shopping Mall . Supported by ICT Business Promotion Council, the inauguration ceremony of  E-Commerce Week took place in The Westin Hotel on 5 January, 2013. Governor of Bangladesh Bank, Dr. Atiur Rahman  was the chief guest of the ceremony. The theme of the week was “Shop Online: Anything. Anytime.” In his speech, Dr. Atiur Rahman said that there were 4.6 million debit and credit card holders in the country and 3 million mobile bank accounts.
  • In February 2013, for the first time in the country, Computer Jagat, the leading ICT magazine of Bangladesh, under the supervision of Dhaka DC Office, organized the first fair on E-commerce  “ই-বাণিজ্য মেলা ২০১৩.” The three-day fair took place from February 7 to February 9 at the premise of Begum Sufia Kamal National Public Library. The slogan of the fair was- “Festival for buying and selling at your premise.” (স্লোগান: ঘরে বসে কেনাকাটার উৎসব). A total of 31 public and private E-commerce organizations showcased their products and services at the fair. Though first of its kind, the fair was huge success attracting eighty thousand visitors. Computer Jagat also did live webcast of the fair which was seen by more than fifty thousand people in Bangladesh and abroad.

Dhaka E-commerce Fair 2013a

 

Dhaka E-commerce Fair 2013b

  • After the success of E-commerce Fair in Dhaka Computer Jagat organized two more fairs in Sylhet and Chittagong. A total of 45 organizations participated in the Sylhet fair attracting thirty thousand visitors. In the Chittagong fair a total of 51 organizations participated.
  • After three successful E-commerce fairs in the country. Computer Jagat, ICT Ministry (currently Ministry of Post, Telecom and Information Technology) and Bangladesh High Commission London jointly organized the first international E-commerce Fair. The three-day UK-Bangladesh e-Commerce Fair will be held during September7-9 at Millennium Gloucester Hotel in Central London. Dr. Dipu Moni, the then Minister of Foreign Affairs Bangladesh inaugurated the fair. 19 organizations from Bangladesh and 13 from the UK participated in this fair. The UK-Bangladesh e-Commerce also repeated the success of previous fairs. Many Bangladeshis living in London and people of London came to visit the fair.
  • Third, Bangladesh Bank gave permission to buy products and services online using international credit cards.  Buying products and services from abroad using credit card is an important aspect of E-commerce but it was not possible for the Bangladeshi international credit card holders. In May last year, Bangladesh Bank gave permission to buy products from abroad via international credit card.

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UK-BAGLADESH e-COMMERCE FAIR, LONDON souvenir article

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Written by S.M. Mehdi Hassan

August 6th, 2014 at 11:28 am

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