Leadership Lapse Limits Bangladesh’s Booming E-Commerce

Bangladesh’s e-commerce sector has witnessed remarkable growth in less than a decade, especially after the COVID-19 pandemic accelerated the trend of online shopping and digital transactions. However, the absence of effective leadership within the e-Commerce Association of Bangladesh (e-CAB) is now hampering this progress. Without a functional leadership, sustainable growth in the sector seems increasingly difficult.

Currently, the size of the country’s e-commerce market has surpassed $4 billion, with an annual growth rate of approximately 25%, outpacing many South Asian economies. Yet, with the right policies and oversight, the pace of this growth could be even faster.

While platforms like Daraz, bKash, Chaldal, ShareTrip, and Steadfast continue to dominate the market, countless cottage, small, and medium entrepreneurs are struggling. The absence of an active executive committee at e-CAB has made it impossible to provide these entrepreneurs with necessary guidance, financial support, and policy assistance.

At present, e-CAB lacks an elected executive body, leaving the entire industry effectively leaderless. This vacuum has triggered widespread challenges across the sector, becoming increasingly severe over time.

Firstly, a policy deadlock has emerged. The Digital Commerce Policy is yet to be fully implemented, hampering industry development. A lack of coordination between payment gateways and banks—especially ongoing disputes over merchant discount rates (MDRs)—continues to disrupt normal business operations. A strong leadership is urgently needed to resolve these issues.

Secondly, consumer trust is rapidly declining. Over the past two years, complaints of online fraud have increased by 15%. In the absence of a centralized complaint resolution mechanism, customers are gradually losing faith in online shopping. If the situation persists, the future of the e-commerce industry will remain uncertain.

Thirdly, small entrepreneurs are being left behind. According to various sources, many e-commerce startups have been forced to shut down operations over the past two years. Without mentorship and training opportunities from e-CAB, new entrepreneurs are missing out on essential support. This trend is weakening both diversity and innovation within the sector.

Several urgent steps must be taken to overcome the current crisis.

First, an accountable and effective leadership at e-CAB must be urgently established. Only an inclusive leadership that engages all industry stakeholders can steer the sector out of this crisis and lead it towards sustainable development. Coordinated and structured leadership is indispensable for the industry’s growth.

Second, reforming policy frameworks has become a necessity. A Digital Commerce Authority should be established to bring the sector under a structured regulatory framework. Moreover, introducing a merchant rate cap (1.5%) would create a more favorable environment for small entrepreneurs. Without such initiatives, long-term growth will be constrained.

Third, to restore consumer confidence, e-CAB must implement a Verified Merchant System that identifies trustworthy online entities. Additionally, a Central Complaint Management System must be introduced to address online fraud. Without ensuring consumer protection, the future of e-commerce will remain bleak.

Fourth, to boost financial inclusion, coordination with the central bank is needed to introduce e-commerce-friendly loan schemes. Simultaneously, connectivity between mobile financial services (MFS), digital wallets, and e-commerce platforms must be enhanced. This will create financing opportunities for small entrepreneurs and accelerate industry growth.

If these steps are properly implemented, Bangladesh’s e-commerce sector can regain momentum. Only through the collective efforts of the government, private sector, and all relevant stakeholders can the industry move towards sustainable development. These initiatives must be taken immediately—there is no time to waste.

Now is the time for coordinated action. If delayed, Bangladesh’s e-commerce sector may remain nothing more than a story of unfulfilled potential. Government policy support, private innovation, and effective organizational leadership—this tripartite collaboration can guide the nation toward a sustainable digital economy.

Author: Mohammad Shahab Uddin Shipon, Former Senior Vice President, e-CAB

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