Tuesday,19 December, 2017
Current issue | Issue 1249, (4 - 10 June 2015)
Tuesday,19 December, 2017
Issue 1249, (4 - 10 June 2015)

Ahram Weekly

Growing potential of e-commerce

Egyptians are using more online services than ever as Internet and smart phone use grows and grows, reports Ahmed Kotb

e-commerce
e-commerce
Al-Ahram Weekly

The potential of Egyptian e-commerce and other online services has never been better, with Internet usage in the country increasing steadily, according to CAPMAS, the Central Agency for Public Mobilisation and Statistics.

Latest statistics show that Egyptian household Internet users increased by 30.3 per cent in 2014 to reach 18.9 million, as opposed to 14.5 million in 2013. They also revealed a 9.4 per cent increase in the number of families who own a computer, reaching 9.3 million last year compared to 8.5 million in 2013.

The Ministry of Communication and Information Technology also announced recently that the total number of Internet users in Egypt has risen to 49.35 million, with 22 million of these accessing the Internet through smart phones and accounting for 23 per cent of all mobile phone service subscribers.

There are 95.35 million active SIM cards in Egypt, with many subscribers having more than one SIM card in use. These numbers make Egypt the leader in the Middle East and North Africa (MENA) region in terms of Internet usage by country.

A recently published report by the online payment gateway Payfort on the Arab world’s online payment industry showed that Egypt, along with Saudi Arabia, is pioneering e-commerce and online services which are growing steadily on a year-by-year basis.

Four thousand shoppers participated in a survey to produce the results in Payfort’s report, which found that Egyptian young people between the ages of 26 and 35 are most likely to shop online.

In addition to online shopping activities like buying clothes and other commodities, food ordering and delivery have become one of the main online shopping activities in Egypt.

“Egypt is the most important country in the Middle East when it comes to e-commerce potential,” said Walied El-Amin, managing director of Hellofood Egypt, an online food ordering and delivery service. The company handles about 32,000 restaurants worldwide and delivers food to over a million customers every day.

 Egypt has been on the company’s expansion map since it started operations in the country four years ago.

“The number of food orders per capita in Egypt is the highest in comparison to any other country, even those with higher average incomes,” El-Amin told the Weekly, adding that Egyptians have long been accustomed to food deliveries.

This made Hellofood decide to enter the Egyptian market, starting in January 2015, and the number of food orders through its website and smart phone application has been growing has been growing at a high rate since then, El-Amin said

“The Egyptian market is one of the fastest-growing markets globally for online food orders, thanks to its huge population and the growing use of the Internet and smart phones,” he said.

Online shopping and booking also allow customers in Egypt to benefit from new services like reserving taxis. Because disputes can erupt between customers and cab-drivers over the price of trips when meters are not working, in addition to safety concerns by some female customers, new online services called Easy Taxi and Uber are becoming more popular.

Bruno Xavier, managing director of Easy Taxi in Egypt, explained that Easy Taxi allows customers to book and track a taxi in real time on a mobile phone through an application that is free to install. The application identifies the customer’s location and calls the nearest cab. He added that a hotline number is available for inquiries and complaints about overcharging or the behaviour of a driver.

Drivers can be “deactivated” from the Easy Taxi system as a result of complaints, he said.

Easy Taxi started operations in Egypt in October 2013, and currently has 30 per cent of Cairo’s taxi fleet working through it, Xavier said, adding that 300,000 rides were made through Easy Taxi in 2014, with a 25 to 30 per cent increase per month.

“Easy Taxi is operating in 40 countries, but Egypt has the biggest fleet and most potential,” he stressed. There are about 50,000 white taxis in the Greater Cairo area.

But Xavier pointed out that many drivers still do not use their smart phones regularly, though this will be overcome soon through training programmes designed specifically for the purpose, as well as to improve quality in general.

The government has also been moving over the last few years to benefit from the growing trend of Internet and smart phone use. It is now possible to access a variety of services, including paying traffic fines and issuing documents, through the Egyptian Government Portal (www.egypt.gov.eg. However, these services are still considered limited in comparison to the large number of people using the Internet.

Ibrahim Sarhan, head of E-Finance, a state-owned company that provides electronic payment services, was quoted during a press conference as saying that taxes and customs duties on products purchased online by Egyptians have increased by 310 per cent over the last four years to reach LE400 billion, showing how effective e-commerce can be in generating state revenues.

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