People living outside of urban areas or in less advantageous zones are deprived of the benefits of the emerging e-commerce industry, owing to their non-existent or limited Internet knowledge, as well as a lack of access to logistics and finance tools. Although many districts are known for producing domestic goods, producers do not receive a fair price because of unequal access to transport facilities and digital financial services. These inequalities lead to a decrease in production, which, in turn, increases inequalities between rural and urban areas. In addition, most e-commerce companies do not have access to the rural market, which remains largely untapped.
Towards a Solution
The vision of the ‘ekShop’ initiative is to create a platform where these marginal producers can sell their products directly to customers and take advantage of online shopping. It integrates all the top e-commerce and logistics companies into a single channel and extends access to over 4,000 physical-digital centres. This single initiative has sparked a ‘Go Rural’ revolution within the e-commerce and fast-moving consumer goods industries, thus acting as the catalyst to create a highly efficient access and logistics infrastructure.
One of the objectives in establishing ekShop was to reduce inequalities between market facilities in rural and urban areas. Through ekShop’s digitized market platform and delivery channel, rural producers were able to access the urban market and sell their goods across the country through all the top e-commerce companies in Bangladesh. Women in particular are encouraged to market their handcrafted products, especially those living in rural areas.
ekShop is a modular platform that uses an application programming interface. It has introduced secure payment system, provided by ESCROW, and uses an integrated payment portal to foster trust between buyers and sellers. Furthermore, digital centres are often used as storage warehouses for products that are frequently ordered by locals. These are one-stop centres run by citizen entrepreneurs in tandem with elected local government representatives where citizens can access over 150 public and private services, some free and some fee-based.
By engaging digital centre entrepreneurs and applying an assisted e-commerce model, ekShop is gradually reducing the digital divide and increasing income in rural populations. Currently, most of the logistics companies are using the digital centres as their delivery points and the centres’ entrepreneurs as delivery agents to ensure access to rural areas.
As of February 2020, over 4,000 digital centres have been on-boarded, and over 32,000 urban-to-rural orders worth 45 million taka (over US$530,000) have been placed. In addition, 230,000 kg of rural-to-urban agricultural orders have been placed, and handcrafted goods worth 20 million taka (over US$235,000) have been sold. ekShop has 3,765 doorstep delivery points with 500 micro-merchants and has completed over 100,000 orders. To date, 300,000 consumers have been served, an average of three per order. Although the majority of payments have been made as cash on delivery (82 percent), some entrepreneurs have used banking and mobile financial services as well. A total of 247 entrepreneurs have become local distributors of fast-moving consumer goods through ekShop, and 2,100 entrepreneurs have been trained in e-commerce by the ekShop team.
ekShop provides an assisted e-commerce model that uses ESCROW payment services and is focused on improving rural sales. It is the only platform to connect 80 percent of the nation's logistics providers with its exclusive geomapping.
All the stakeholders and partners involved with ekShop benefit from each transaction. As a result, they have taken ownership of the initiative, along with the Aspire to Innovate (a2i) Programme, and will maintain it on an ongoing basis. A revenue ecosystem is established, in which all the connected commission flows need not depend on any external sources. Furthermore, the initiative has led to the establishment of the National E-Commerce Policy of 2018 and the E-Commerce Policy for Small- and Medium-Sized Enterprises in 2019.
ekShop has crossed international borders to replicate this model. There are four operational hubs: ekShop centres in Malaysia and Singapore and full ekShop architecture operations in Turkey and Nepal. This cross-country transfer has increased the number of people who can access the digital services that ekShop has to offer. ekShop also exports rural products to several countries.
For an ekShop model to thrive in an area, the digital market must have multiple e-commerce players and logistic facilities. There must also be stable Internet connectivity. This initiative is based on the idea of making e-commerce platforms as easy to access as possible. As a result, it does not require a complex project design or significant investment.