History of E-Commerce in Nigeria will be discussed in this article. This is written to inform you of the gradual indispensability of E-Commerce in Nigeria.
E-commerce refers to all commercial and business transactions conducted online or electronically using the internet. It is also known as electronic commerce or internet commerce and often involves the use of mobile applications.
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The commonest of E-commerce is online shopping but there are also a handful of others such as online ticketing, internet banking, online auctions, and payment gateways.
In E-commerce, the products on the shelf range from physical items to diverse services and digital products. Transactions made on Jumia, Konga, and Jiji are familiar examples of E-commerce.
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Here is a Brief History of E-Commerce in Nigeria
Following Paypal’s ban of accounts with Nigerian IP addresses in 2005, E-commerce in Nigeria suffered some retrogression and was reduced to the barest minimum because there was no alternative way through which electronic payments to be made.
Up until 2009, the obtainable forms of E-commerce were such as required customers to make bank deposits before the delivery of their purchased goods or services and this hampered the main objectives and competitive powers of E-commerce which were/are its ability to save time with speedy and near-instant transactions and the convenience with which transactions could be made regardless of distance and other physical barriers.
For the years that would follow, E-commerce in Nigeria was largely manual, for lack of e-payment platforms which would not be intercepted by the widespread fraudulence among the Nigerian populace (the red flag which Paypal closed all Nigerian accounts).
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But for the move by Nigeria’s Visa-Packed ValueCard, Interswitch, and eTransact to provide online switching payments, coupled with CBN’s policies such as CIBSS which enables local intra and inter-bank online transactions banks, the growth of E-commerce in Nigeria would have remained stunted.
Also, with the invention of internet banking launched by Guaranty Trust Bank and First Bank, a glimmer of hope shone on Nigerian E-commerce.
Howbeit, Nigerian E-commerce, just like those of most African countries, is still in the premature stage and is faced with the challenge of the unwillingness of investors to make substantial investments.
However, experts believe that in another ten years there will be such an emergency that would strengthen this segment of the Nigerian economy due to the increasing number of internet users, who will, in turn, utilize the transaction options made available by e-commerce.
It was based on this prediction that Jumia, against all odds, braved the hurdles on the path of Nigerian E-commerce and in June 2012, founded what has become the largest E-commerce company in Nigeria.
Jumia was cofounded by a Ghanaian Harvard Business School graduate Raphael Afaedor and Rocket Internet, a based in Berlin internet start-up incubator.
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In about 7 years of operation, Jumia online marketplace has employed 4000 people and partnered with 50,000 local African companies and individuals.
In Nigeria, its closest competitor is Konga, which is the second-largest E-commerce Company in the country. At the moment, local E-commerce companies’ short term profitability is not yet a reality but the statistics divulged that in 2018, there were 92.3 million internet users, and predicts that the number will hit 187.8 million in 2023 and this means more entrants into the market and an increased proclivity for patronage.