New Telegraph

December 8, 2023

E-Commerce: Nigeria ranked 33rd largest market globally

A survey by ecommerceDB has ranked Nigeria the 33rd largest market for e-Commerce globally. This came with a revenue of $6.9 billion in 2021, placing it ahead of Denmark and behind Colombia. According to the report, South Africa is the 41st largest market for e-Commerce with a revenue of $5 billion in 2021, placing it ahead of Iraq and behind Philippines; Kenya is the 54th largest market for e- Commerce with a revenue of $1.7 billion in 2021, placing it ahead of Sri Lanka and behind Hungary; and Egypt is the 39th largest market for e-Commerce with a revenue of $5.2 billion in 2021, placing it ahead of Philippines and behind Iran.

“With an increase of 30 per cent, the Nigerian e-Commerce market contributed to the world-wide growth rate of 15 per cent in 2021, and with an increase of 19 per cent, the South African e- Commerce market contributed to the worldwide growth rate of 15 per cent in 2021 and with an increase of 44 per cent; in the Kenya, the e-Commerce market contributed to the worldwide growth rate of 15 per cent in 2021 and with an increase of 44 per cent, the Egyptian e-Commerce market contributed to the worldwide growth rate of 15 per cent in 2021. “As new markets are emerging, e-Commerce growth in Africa and is expected to continue over the next years,” the report added.

As reported by Africa Business Communities, e-Commerce transaction of goods and services between business-to-consumer (B2C), business-to-business (B2B), consumer-to-consumer, and consumer-to-business, has become rampant in this digital age. Innovations in digital payments have transitioned the retail industry in Africa and across the world. A recent report by Visa showed that the top market contributors to e-Commerce in sub-Saharan Africa over the last three years were South Africa, Nigeria, and Kenya, with Ghana also showing growth, having replaced Kenya in the top three contributors in 2020.

The report further stated that although sub-Saharan Africa is one of the smallest regions of e-Commerce globally, it shows steady growth potential. During lockdown, the region saw new e-Commerce users rise by five per cent when compared to the active base in the previous year. Another report by Statista stated that in 2020, South Africa was the country with the largest number of online marketplaces for physical goods in Africa, with four North African countries; Morocco, Tunisia, Egypt, and Algeria, following suit. In total, Africa counted at least 631 B2C online marketplaces for physical goods.

Earlier this year, another report by Research and Markets stated that South African e-Commerce industry will reach $7.9 billion by 2027 due to an increase in penetration of smart devices and the growing internet connectivity, as well as the increasing integration of e-Commerce platforms with various advanced technologies, such as cloud computing, artificial intelligence and predictive analytics. Multilateral development finance institution, African Development Bank (AfDB), has also been intrumental in accelerating the e-Commerce industry in the continent.

The institution recently approved a $1.5 million grant to Smart Africa Alliance to strengthen the policy environment for digital trade and e- Commerce across Africa. The funding would be used to assess policy gaps in the digital trade and e-Commerce ecosystems in 10 African countries; Côte d’Ivoire, Benin, Ghana, Liberia, Uganda, South Sudan, Zimbabwe, The Republic of Congo, São Tomé and Príncipe, and Democratic Republic of Congo. A perfect growth case at hand is the recent partnership between payments giant Mastercard and Cellulant, which will allow millions of Cellulant customers across Africa shop and pay online with global merchants wherever Mastercard is accepted. With this partnership, customers will be able to pay globally with a Mastercard virtual payment solution linked to the Cellulant wallet, Tingg. Mastercard’s technology will enable consumers to shop online with or without a bank account, through a simple and secure payment experience.

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