With rising internet penetration and data usage on mobile phones, India offers a whopping $50 billion (nearly Rs 3.5 lakh crore) opportunity in the e-commerce space, says a joint report by Bain and Company, Google and Omidyar Network. As digital literacy and awareness increases, e-commerce sector will offer more opportunities. By driving awareness, transactions among the existing and the next set of Internet users and consumers, there is a potential to untap over $50 billion opportunity. The joint reports carries inputs of about 3,400 respondents.
In the year 2017, e-commerce sector in the country recorded $20 billion in sales. However, this figure comes much below to the $459 billion in the US and $935 billion in China, the rate of online spending growth was the highest among the major economies.
Even though country’s e-commerce market is for sure at a much lower base than the US or China, and only contributes 2 percent of the overall retail, the penetration is such low that the segment is only expected to grow at much higher pace in the coming years.
Out of the 390 million active users on Internet in the country, those who transacted online are meager 40 percent that amounts to 160 million. Among these, 90 percent or 140 million belonged to comparatively affluent backgrounds.
However, there are few issues which need to be resolved so that the actual potential of the sector can be explored. First of all more and more people from the rural background need to come on board. Secondly, more women need to use internet. Thirdly, problem of high user drop-outs need to be resolved.