Despite the fact that only 21% of Pakistani adults have transaction accounts, online sales have increased massively. Cash-on-delivery transactions account for 60% of the overall value of e-commerce, according to the commerce ministry’s estimates.
ISLAMABAD: Shoppers’ physical movement is severely restricted due to the pandemic of coronavirus in Pakistan, the country’s largest online marketplace stated on Sunday.
Exports have increased and job possibilities for young people have been created as part of efforts to build the country’s digital economy in recent years.
However, it appears that the digital disruption that Pakistan’s economy has long sought is being brought about by containment measures connected to coronaviruses.
“We’ve had a tremendous response… Daraz.pk’s chief marketing officer Muhammad Ammar Hassan told Arab News that online orders have increased nine-fold since March.
Pakistan’s largest online shopping portal, Daraz.pk, is owned by worldwide e-commerce giant Alibaba and features more than seven million products, more than 30,000 dealers, and 500 distinct brands. In addition, 300 Pakistani companies have applied to export a variety of goods to other countries.
Each item has grown by 100% year-over-year, Hassan said, and this has further increased since March because of the coronavirus.
But he said that the lack of bank accounts in Pakistan was a huge problem for internet enterprises and digital marketing in the country. Only 21% of Pakistani individuals have transaction accounts, despite the country’s overwhelmingly cash-based economy.
According to data from the central bank from November of last year, only 7% of these account holders are women. A shift to electronic payments, according to Pakistan’s central bank, will increase consumption and trade by as much as 7%, create 4 million jobs, and enhance GDP by $36 billion by 2025.
Although Pakistan’s digital business is still in its infancy, e-commerce transactions and the number of registered e-commerce merchants have steadily increased. According to Pakistan’s Ministry of Commerce, the sales of local and international e-commerce merchants climbed from Rs20.7 billion in 2017 to Rs40.1 billion in 2018.
According to Aisha Humera Moriani of the Ministry of Commerce, “These figures do not include all the post-paid, COD transactions, which account for 60% of the overall value of e-commerce in Pakistan.”
Exports will benefit from the government’s development of an international payment gateway, which will be integrated with other online payment businesses like PayPal.
As a result of COVID-19, we’ve had to postpone the creation of the payment gateway, but we’ll be working hard to get it up and running as soon as possible,” the CEO of the National Information Technology Board said.
If Pakistan’s e-commerce platforms were given tax advantages and regulated by the government, the encouraging online sales figures would continue to expand, according to businessmen. As the number of people visiting shopping malls and retail shops is nearing a standstill.
Rana Tariq Mehboob, chairman of Pakistan’s Chainstore Association, a group representing 200 of the country’s most prominent retailers, told Arab News that foot traffic in stores and shopping malls has dropped by up to 80% since the coronavirus outbreak. However, retail revenue has only decreased by 25%.
Since March, brick-and-mortar retailers have seen a 60% drop in sales, he claimed, as most consumers have shifted to buying online.
Online buying has grown tremendously, he noted. “Online sales now account for the majority of our income. Despite a 50% increase in online sales, firms remain unprofitable.
Many brands in Mehboob’s organisation are considering closing their brick-and-mortar stores after August in order to save money and focus more on their internet businesses, Mehboob stated. The size of internet enterprises, he cautioned, would be constrained as long as the government did not assume control of electronic trade.
