M-Pesa, Western Union and Amazon could potentially disrupt Jumia’s e-commerce business
By Clinton Madegwa
Africa has been a laggard in ecommerce for many reasons, including lack of internet access, poverty, a high rate of illiteracy, and logistical inefficiencies. Most of these problems persist but technology advances — notably smartphones — have given millions more Africans access to the internet and mobile payment systems.
Consequently, the continent may be the next emerging market to make significant strides in online shopping. Research firm Statista estimates that the ecommerce sector in Africa generated $16.5 billion in revenue in 2017 and forecasts revenue of $29 billion by 2022.
Three countries — Nigeria, Kenya, and South Africa — dominate e-commerce sales. Kenya has a population of 48.5 million and an impressive 79 percent internet penetration. This is because Kenya is home to M-Pesa, the mobile wallet provider started by mobile telecom provider Safaricom. The availability of a secure payment system encourages internet access and online buying.
Photo courtesy of Scott Mainwaring.