Overview
E-commerce is developing rapidly in the Kyrgyz Republic and reached $360 million in 2024 according to Ministry of Economy and Commerce estimates. It is overwhelmingly Business-to-Consumer (B2C); there is no major digital platform for Business-to-Business (B2B) transactions. Western e-commerce giants like Ebay or Amazon are not fully available in the Kyrgyz Republic; however, large e-commerce companies from Russia, such as Wildberries and Ozon, are rapidly developing. Internet access outside of major cities is unreliable but improving quickly. ATM/debit cards are extremely common in Bishkek. ATMs are a common sight in most medium-sized villages. Electronic payment of salaries is becoming more common, and most local banks have developed applications for mobile phones. Nevertheless, the Kyrgyz Republic is primarily a cash economy, though e-payments, predominantly via MBank, are aggressively emerging throughout the country.
Consumer Behavior
Significant advances in e-commerce have occurred locally in mobile payment systems and app-based commercial platforms. There are more online shops now than several years ago, and the variety of commercial services available via the internet has expanded significantly.
Despite recent technological developments, however, most Kyrgyz citizens prefer traditional forms of purchasing goods and ordering services. A key challenge to the development of robust e-commerce in the Kyrgyz Republic is the perception that goods purchased online may be of lesser quality, and that services can be better negotiated in person. Consumers may also be concerned about poor customer service and no clear recourse in the event of a negative e-commerce experience.
In 2020, the Kyrgyz Republic ranked 97th out of 152 countries in UNCTAD’s B2C ECommerce Index. No updated ranking has been published by UNCTAD since. The index assesses the willingness of countries to develop e-commerce based on four indicators: internet penetration, the presence of bank accounts among the population, the share of secure servers per 1 million of the population, and the level of development of postal services according to the rating of the Universal Postal Union.
According to the E-Commerce Association of the Kyrgyz Republic, there are 257 active e-commerce websites in Kyrgyzstan, 72 percent of which are virtual showcases of offline stores. To stimulate the transition of entrepreneurs to e-commerce the government could implement a series of measures, starting with an understandable and accessible algorithm for starting a business in this area, simplified taxation, modern and convenient electronic payment systems, and a developed system of goods logistics, especially in cross-border trade.
The country has developed an e-commerce strategy for 2023-2026 that is aimed at improvement of the legislative framework and financial infrastructure development. E-commerce development is heavily supported by various international organizations. A national e-commerce law was passed in 2021 and came into effect in June 2022.
There is ample opportunity for improvement and development of e-commerce in the Kyrgyz Republic. High speed, affordable internet access and usage – particularly in mobile broadband – are expanding throughout the country. The Kyrgyz Republic does have a steadily developing IT sector, and the undeveloped e-commerce sector may present investment opportunities for tech entrepreneurs.
Local Service Providers
Local internet retailers are rapidly increasing in the Kyrgyz Republic, though overall penetration remains low. Popular domestic e-commerce sites include Svetofor.info, Lalafo.kg, Kivano, Shoppix.kg, Max.kg, Amazon, Wildberries, and Ozon. Svetofor identifies itself as the most popular online commercial market in the Kyrgyz Republic and offers a wide variety of retail goods. Lalafo is akin to an online trading site such as eBay or Craigslist. Chinese e-commerce websites such as taobao.com and alibaba.com are more popular than other international e-commerce platforms; many Kyrgyz companies retain Chinese-speaking staff to help locals make purchases through Chinese e-commerce websites. Russian marketplace Wildberries.ru is a popular international platform, which since May 2021 has allowed Kyrgyz entrepreneurs to sell their products on its website. In 2023, Wildberries announced starting construction of a second logistics center in Bishkek. Wildberries reported that its sales of products from the Kyrgyz Republic during the period of January-August 2024 increased by 220 percent compared to the same period the previous year. Amazon ships some, but not all products to the Kyrgyz Republic. In May 2021, Amazon announced that Kyrgyz companies may officially register on the website and sell their products.
Social Media
The social media market in the Kyrgyz Republic is rapidly growing, with an estimated 80 percent of internet users actively engaged on social media platforms. Social media is an effective tool to market products and is often the only way businesses advertise their services.