Describes what a company needs to know to take advantage of e-commerce in the local market and covers prominent B2B websites.
The onset of COVID-19 changed the mode of doing business in Botswana and as appears to be trending globally, it is increasingly becoming the “new normal” to work predominantly online and/or from home. There has been in uptick in internet usage since 2020. The communications sector has played a huge role, not only in facilitating the dissemination of critical COVID-19 information to the public by government health entities but also provided a platform for businesses to continue with their commercial activities. Botswana Communication Regulatory Authority (BOCRA) noted a significant shift in the consumption patterns of ICT services early in the 2020-21 financial year from offices to home environments. In response, the Board of Directors for BOCRA approved additional radio frequency spectrum and capacity to enable operators to provide and upgrade residential service packages to accommodate commercial and office workloads. Mobile phone subscriptions have grown by more than a million in the past five years from 3,181,600 in March 2018 to 4,243,124 in March 2022. This could also be attributable to the 55 percent reduction for mobile broadband pricing and an increase in the size of data bundles by 200 percent. Equally Fixed Broadband prices were reduced and resulted in a 269 percent increase in the uptake of fixed broadband services to reach 8.3% market penetration in 2021 compared to 2.26 percent recorded in 2020. The expansion of the Fiber to the Home (FTTH) infrastructure also enabled this increase in penetration. Despite these positive movements, eCommerce remains relatively immature compared to that of Botswana’s economic peers. Most eCommerce interfaces are on social media platforms and require transactions to be concluded via phone or in person. A small minority of companies have stand-alone websites. The GoB has sought to lower the cost of internet usage by offering substantial discounts to internet providers to lease government-owned fiber-optic cables. Mobile broadband service using cellular technology is available, and coverage is generally good, but it is slow. DSL service through fixed lines and a relatively good national fiber backbone is somewhat reliable, but it is expensive relative to U.S. internet costs. The country, however, slashed data costs by 46 percent, making data costs competitive in the region. Although the connection to the Seacom (Africa East Coast) has been completed and Botswana has access to the ACE (Africa West Coast) undersea cable, internet speeds continue to be slow. The GoB has partially privatized the state-owned Botswana Telecommunications Corporation.
Most Batswana access the internet through mobile devices, mainly smartphones. Those who use computers largely do so over copper telephone wire infrastructure which limits connections to 2 Mbps; however, connections can rise to over 1,000 Mbps. BoFiNet, the state-owned enterprise that controls the country’s fiber optic network, is providing the infrastructure connection upgrades to diplomatic missions and businesses, covering about 5,953 of commercial and government premises and is continuing to connect fiber to homes in line with their Strategy 2020. According to the organization’s 2020 annual report, it has covered 10,600 km and connected 206 out of 399 villages. BoFiNet has adopted an UNLEASH 2025 strategy to drive the country’s digital transformation and implement initiatives that will foster the ICT ecosystem.
Point of sales for credit card transactions are numerous and widely available with reliable connections to processing centers.
The National Cyber Security Strategy was approved in October 2020 and the GoB also set up a Computer Incident Response Team (CIRT), which is responsible for responding to Cyber-Security breaches and viruses. Botswana, in conjunction with United Nations Conference on Trade and Development (UNCTAD), released the National ICT Policy Review and e-Commerce Strategy report in 2021. The report looked at the challenges of e-Commerce in Botswana (poor quality of service and high data costs amongst them) and came up with recommendations to mitigate them.
Legal & Regulatory
The GoB passed the Electronic Communications and Transactions Act in April 2014. The law enables the facilitation and regulation of electronic communications and transactions, streamlining commercial and bureaucratic procedures. The GoB earmarked $15 million for the law’s implementation in its 2014/2015 budget. Subsequently, parliament enacted an Electronic Records (Evidence) Act in 2014, which allows for the admissibility and authentication of electronic records in legal proceedings, and admissibility in evidence of electronic records as original records. The Electronic Records (Evidence) Regulations of 2016 establish an approved process for the certification of electronic systems.
The backbone of Botswana’s National Payment System (NPS) includes the Botswana Interbank Settlement System (BISS) and the Botswana Automated Clearing House (BACH). At the regional level, the SADC RTGS provides for high value cross border payments and used primarily for interbank and corporate payments denominated in South African Rand and U.S. dollars and is hosted by the South African Reserve Bank (SARB) on behalf of SADC member countries.
The use of mobile money accounts has increased significantly with mobile money subscriptions increasing by 16.5 percent from 1,466,962 in March 2021 to 1,689,062 in March 2022. This coupled with the high usage of mobile internet and the major shift to e-Wallet use by both individuals and small, medium, and micro enterprises (SMMEs) shows an increased opportunity for e-Commerce in Botswana. According to the National ICT Policy Review and e-Commerce Strategy report released by UNCTAD, there is still a need to drive awareness on the usage (including potential benefits and value) of e-Commerce platforms for citizens and SMMEs because only a small percentage of internet users use e-commerce platforms. About 30 percent of internet users used e-commerce in 2014. Botswana Post Services has a large network of offices across the country and uses an internet platform to deliver its services and further creating a support for e-commerce as their services include freight forwarding and courier services.