Pandemic is Still driving e-commerce growth In Sub-Saharan Africa: VISA

Recent reports keep validating the need of businesses having a digital presence. 

Visa has noted that new e-commerce users in Sub-Saharan Africa increased by 5% in 2020 due to the lockdown caused by the coronavirus epidemic when compared to the active base the previous year, 

According to the report, this is due to a desire for e-commerce to fill the gap left by the shutdown of face-to-face retail, which was imposed around the world, including the region, to combat the viral epidemic. Although most countries in the area are back to open stores, e-commerce is here to stay. 

“The COVID-19 pandemic has driven customers to e-commerce and digital payment usage. The economic shocks that followed COVID-19 have reduced spending power across the world, including SSA, but the closure of physical stores has provided a growth opportunity for digital payments and e-commerce itself.” Visa.

E-commerce sales predicted to rise

The report on e-commerce developments in Sub-Saharan Africa also mentions that the economic shocks that followed COVID-19 have reduced spending power around the world, including in the region, but that the closure of physical stores has provided a growth opportunity for digital payments and e-commerce.

As a result, VISA predicts that global e-commerce sales will reach US$7 trillion by 2024, with Asia Pacific, notably China, India, and Southeast Asia, accounting for 56 percent of global volume.

Over the next five years, countries in the Middle East and North Africa have the greatest development potential.

The Sub-Saharan Africa region, on the other hand, trails behind the Middle East and North Africa region, but it still has a lot of promise, with a noted 42 percent year-on-year increase from 2019 to 2020.

E-commerce growth Influencers 

Many factors influence the industry’s growth, including cross-border transactions, which account for more than half of all e-commerce transaction volumes in Sub-Saharan Africa. According to the report, this reflects a global trend of cross-border online business to consumer (B2C) shopper interactions.

Consumers accessing burgeoning domestic African eCommerce giants such as Jumia (Nigeria & Kenya), Kilimall (Kenya), and Takealot (South Africa) across local boundaries account for a fraction of these cross-border volumes in Sub-Saharan Africa.

Because domestic e-commerce in Sub-Saharan Africa is just getting started, it gives an exciting potential for the region to build its own e-commerce heavyweights and improve the continent’s connectivity to the rest of the globe.