E-commerce Market Grows by 55.5pc with Growth in Digital Payments: SBP

Pakistan's e-commerce market is estimated to have expanded to Rs 234.6 billion in FY20 during the pandemic. The sector witnessed growth of up to 55.5 percent on a year-on-year basis, according to State Bank of Pakistan's (SBP) recent Special Section on 'Covid-19 and the Need to Boost Digital Connectivity in Pakistan'.

While economies all across the globe had to adapt to this sudden disruption in the usual business activities due to the pandemic, Pakistan's retail and ecommerce sector has also witnessed this shift towards online solutions to meet their customers' needs.

According to the SBP report, the pandemic also quickened the pace of this transition towards e-commerce by increasing the need for online channels for shopping. Within the digital payments, ecommerce transactions made via branchless banking channels more than doubled from last year.

However, Cash-on-delivery is still the prevalent mode of transactions in the e-commerce sector, primarily because of high level of uncertainty and consumer trust being a major concern in the sector.

The SBP report explains that there has been a noticeable shift towards digital payments and alternate delivery channels even beyond the e-commerce sector.

As, the importance and usage of electronic banking and alternative delivery channels increased during the post-Covid-19 period, SBP has also further incentivized the use of digital financial channels by instructing banks to waive all inter-bank and intra-bank charges on digital transactions.

Moreover, instructions were given to ensure proper functioning of ATMs and 24/7 access to customer helplines and call centers to smoothen customer support and IVR banking.