E-commerce and Developing countries
Introduction
E-commerce in underdeveloped nations Developing nations are attempting to catch up because they are so far behind in this area. These nations are attempting to imitate the policies of industrialized nations like the USA and UK, who have profited from low-cost access to larger markets and have been able to enter markets whenever they want to, giving them a competitive edge (Gautam, 2012; Khan et al., 2017a). The use of e-commerce has provided organizations with a variety of chances to enter the domestic and international markets of industrialized nations.
What potential issues with e-commerce might there be in underdeveloped nations?
Because of the difficulties, e-commerce is not widely used in poor nations (Vaithianathan, 2010; Das and Khan, 2016). Additionally, it should be noted that, in contrast to developed nations, people in developing nations typically do face-to-face transactions. They want to inspect whatever they intend to buy and bargain for the best price. E-commerce in poor nations is advancing slowly because it encounters several obstacles (Azizi, 2013; Awan and Khan, 2016). Many businesses in underdeveloped nations are still unaware of the potential advantages of e-commerce.
Before developing nations can fully realize the advantages of e-commerce, there are several issues with it that need to be resolved (Vaithianathan, 2010; Khan and Fournier-Bonilla, 2016). Small and medium-sized businesses in developing nations can benefit from e-commerce by opening up opportunities in both domestic and global markets. This has a positive impact on economic growth, which increases revenues and profits. The number of societies conducting business electronically is increasing in developing nations, but they are unable to keep up with wealthy nations because they are unable to fully utilize the potential and efficiencies of e-commerce (Huamei, 2013; Ojo-Agbodu and Omah, 2012).
Environmental and financial limitations in underdeveloped nations (Gikandi and Bloor, 2010; Khan et al., 2016) also play a role in the little benefits of e-commerce being realized in these nations. The majority of e-commerce research for developing nations has concentrated on social and legal issues like privacy, authentication, trust, psychological and cultural barriers, internet access, and e-security (Kundi et al., 2012), but not enough research has been done in the areas like technological infrastructure, policy initiatives, and trust that are limiting the growth of e-commerce (Makame et al., 2014; Khan and Alhusseini, 2015).
E-commerce has the ability to increase productivity and efficiency, revolutionize how business is conducted, and present great chances for growth in developing nations if given enough consideration (Gautam, 2012; Uwemi and Khan, 2016). Therefore, it is imperative to assess the difficulties that e-commerce in developing nations is facing. Numerous studies have been conducted to comprehend how e-commerce has enhanced commercial transactions globally and how the constraints are hurting e-commerce in emerging nations (Azizi, 2013; Vaithianathan, 2010; Bashir and Khan, 2016). Oreku et al(2009) .'s research established the huge potential of e-commerce in enabling individuals in developing nations to overcome challenges and establish a sustainable economy.
Understanding the current state of e-commerce internationally, this research project will use Nigeria as a case study to examine the obstacles preventing e-commerce in emerging nations and will also provide suitable remedies.
How do poorer countries benefit from mobile telephony?
SMEs in the agricultural and fishing industries can make use of mobile technologies. It can be used for mobile money, micro-credit services, and the mobilization of labor and transportation. This section gives a general overview of how SME business owners in developing nations employ mobile technology across a range of industries.
Agriculture
Increased productivity can increase farmers' revenue, particularly for small-scale farmers and fishers who have less resources for crop production and marketing. At the local or national level, improving the efficiency of the value chain necessitates involving a wide range of parties, from suppliers and distributors to farmers who raise cattle and grow crops.
Mobile technology is being used more and more by farmers in developing nations to boost their commercial.
Product traceability is becoming more and more important for developing nations looking to enter or grow in new export markets. On the one side, ICT use has increased consumer protection and food safety, while on the other, it has improved farmer livelihood outcomes. RFID chips are also employed to track animal movement, making it possible to keep an eye on animals from birth until death. The system is being used in Namibia to replace conventional paper-based recording methods because it improves data accuracy and speed of dissemination, which increases the value of animals.
Animal poaching has also been thwarted by the use of RFID.
mobile cash
The use of mobile money services is growing. They have contributed to making businesses run better, and now they are also making a difference in the fight against poverty. The poor's lack of access to formal financial systems is one of the main obstacles to reducing poverty. The use of informal instruments limits the ability of the poor to responsibly manage risk, save, borrow, and repay debt.
Mobile money services are becoming more popular in developing nations because of their efficiency in handling payments and facilitating access to credit, especially in places with limited access to physical bank branches or even ATM machines (see Chart 4). Additionally, they contribute to rising production and efficiency.
The most popular mobile phone-based banking service in any developing nation, M-Pesa has grown swiftly. In Kenya, there were 17 million M-Pesa accounts registered as of 2012.
Branchless banking services, such as M-Pesa, allow customers to carry out simple financial transactions without having to go to a physical location of a bank. M-continued Pesa's success in Kenya is a result of the development of an incredibly well-liked, reasonably priced payment service with.
E-commerce is typically portrayed in extremely favorable terms, however there are also possible drawbacks for developing nations. E-commerce adoption varies substantially from nation to nation in emerging nations. However, numerous others encounter comparable barriers to e-commerce. These primarily include a lack of a physical, financial, and legal infrastructure to support the growth of e-commerce.
The growth of various forms of e-commerce is largely influenced by the structure of the industrial sector already in place and by how that sector fits into a particular sectoral value chain. The applicability and transferability of the e-commerce models developed by some affluent countries has also been observed to be constrained by the differences in cultures and business philosophies among developing countries.
These nations typically continue to be inaccessible to fiber optic cables and must rely on satellites for global communication—and occasionally even domestic connectivity. Even though technology has made enormous advancements, this still occurs.
Lack of technological expertise, which prevents SMEs from maximizing their potential in e-commerce, is another area of worry. Many developing nations lack a workforce with adequate ICT and mobile technology training. Many SMEs who might be looking to diversify or expand into e-commerce are severely harmed by this.
The key to securing the economic benefits of e-commerce is ensuring that businesses have the necessary set of skills and capacities to employ relevant technologies profitably.
Analysing the growth of e-commerce in developing countries
The world has undergone a change in recent years that is having an impact on several businesses. It is altering how business partners form relationships with one another. Over the past 20 years, computing power has increased by a factor of more than 10,000 per dollar.
The Internet is expanding quite quickly. Data services are being made available to hundreds of millions of consumers throughout the world thanks to new digital mobile terrestrial services and technology. Some industrialized nations already offer 2.5G mobile terrestrial services and are constructing their 3G mobile infrastructure.
High-speed Internet access will be available through portable digital mobile devices connected to 3G mobile networks and the communication and application environment made available for such devices by Wireless Application Protocol (WAP)
What is your business model, though? Time and geographic constraints are being broken down by the digital revolution. To form alliances and build new services, it is bringing together businesses from the banking, computer networking, television, and telecom sectors. Changes in one region of the world have an impact on numerous other regions in the emerging global electronic economy.
One of the key causes fueling the digital revolution is e-business trade. It is generating new economic models in developed nations while posing extremely fresh difficulties for developing nations that still lack some of the fundamental technology, regulations, and legal structure needed to participate in this revolution.
Components and Requirements of Technology for e-Business Among other things, the infrastructure required to enable e-business services includes trust, secure transaction, and e-payment components.
Truest secure transactions and an e-payments provider are among the infrastructure requirements for providing e-business services.
among others that are outside the discussion's purview). E-business transactions need to be safe because of how anonymous they are. By dividing the technology needs into e-security and e-payment components, some of the requirements can be more thoroughly explained.
A slightly different strategy for adopting e-business is required due to the poor banking services, limited Information and Communication Technology (ICT) infrastructures, and absence of a legislative and regulatory framework in developing nations.
Following a discussion and analysis of the technical needs and the part that e-security plays in the e-business strategy for developing and least developed nations, the section below provides an explanation of some of the key e-security aspects.
Factors impeding the uptake of e-commerce in developing nations The study revealed particular infrastructural issues that prevent poorer nations from adopting e-commerce. The adoption of e-commerce in underdeveloped nations is hampered for a variety of reasons. The most frequent causes, which vary greatly between nations, include:
enabling factors infrastructure (technology, network availability of ICT skills, qualified personnel); cost factors (costs of ICT equipment and networks); security and trust factors (uncertainty of payment methods, and legal frameworks); inadequate distribution logistics; "lack of feel-and-touch associated with online purchases," and "problems in returning products." Infrastructure-related obstacles The study revealed particular infrastructural obstacles that prevent underdeveloped countries from adopting e-commerce. Lack of credit cards and efficient payment methods, inadequate distribution logistics, a dearth of specialized, reputable, and sizable internet retailers are some of the challenges.
Conclusion
The emphasis of this brochure has been on how mobile phones and e-commerce have significantly improved the lives of several people in developing nations. Through improved communications and more access to information, having internet and mobile phone access helps the poor's quality of life.
Because they have access to information on market prices, many underprivileged farmers can now sell their produce for higher prices. A prime example is the African firm TradeNet, a trading platform with its headquarters in Ghana.
The internet and mobile devices have also given rise to a large number of microbusinesses that provide jobs for those with limited means and education, such as selling airtime and repairing or refurbishing handsets. Farmers can lessen risk when they have access to information on prices and stocks.