Experts propose 8 different solutions to enhance e-commerce in Africa.
The first is improving payment processing. Payment processing is a major constraint for e-commerce in Africa. To address this, local payment systems such as Paystack and mobile money can be used. This can improve transaction success rates and customer experience.
Additionally, these applications provide protection against fraud and enhanced security measures. Mobile money services like M-Pesa strengthen e-commerce in areas with limited banking infrastructure.
To improve payment processing, it is important to focus on the following: ensuring high security that complies with global standards, improving payment methods, and using data analytics to detect fraud, as well as offering various payment options, including mobile money and local payment gateways.
The second solution is to improve logistics and delivery. In developed markets, delivery times range from 2 to 5 days, while in Sub-Saharan Africa, they range from 10 to 14 days. Partnering with providers like DHL or utilizing drone delivery can help address this issue.
There are also local organizations making strides in this area. The Nigerian startup Kobo360 uses a digital platform to connect businesses with trucking and storage services, while enabling cross-border logistics and real-time shipment tracking. Zipline has launched drone delivery processes in Ghana and Rwanda.
The third challenge facing e-commerce in Africa is security. Improving product quality and satisfying customers over time will address this issue.
Additionally, the fourth obstacle to the growth of e-commerce in Africa is the lack of internet access and digital participation. Internet access and digital literacy are lagging, as only 28% of the population in the continent has access to the internet.
Reducing the cost of mobile internet would allow people to access the internet more easily.
To further strengthen e-commerce in Africa, simplifying cross-border regulations is also necessary. The African Continental Free Trade Area (AfCFTA) is working to change this by connecting a market of 1.3 billion people with a GDP of $3.4 trillion.
The sixth solution to enhance e-commerce in Africa is strengthening cybersecurity. Cybercrime has been on the rise in the continent, and combating this has become more important recently. Large e-commerce platforms like Paystack and VoguePay in Africa are implementing security measures.
The seventh solution is to increase financial inclusion. Mobile technology is transforming access to financial services, bringing millions of people who previously lacked banking services into the digital economy.
Finally, the last solution is to encourage innovation in e-commerce. The sector should be expanded to different markets.