Assessment of Current Buyer Behavior in Market
Online activity is concentrated in Kathmandu and a half-dozen other cities, with relatively little internet penetration in rural areas, although this is changing with more users accessing the internet via mobile phones. While relatively little business activity is conducted online, the market is growing. Many businesses rely on the internet when dealing with foreign partners. The COVID pandemic has resulted in an increase of digital/online business activities and is expected to boost e-commerce and digital transactions in future.
While e-commerce is in its infancy in Nepal, it is growing quickly. Credit/debit card transfers, transfers from e-banking websites, and digital wallets are becoming more prevalent, especially in urban areas. However, Nepalis who do not have a dollar account cannot make payments using foreign currency.
Local eCommerce Sales Rules & Regulations
In June 2020, the Ministry of Industry, Commerce & Supplies completed a draft E-Commerce Bill. Following other Ministries’ review, the bill will be presented to cabinet approval and then presented to Parliament to enact into law.
Post is not aware of any sites promoting B2B eCommerce. Like all forms of eCommerce in Nepal, B2B eCommerce is in a nascent stage. While B2C is picking-up pace, secure electronic payment systems are still being built up. Deliveries generally operate based on calling up the client and requesting directions to the delivery address.
Local eCommerce Business Service Provider Ecosystem
eCommerce websites for consumers in urban areas, particularly the Kathmandu Valley are burgeoning. Online food delivery website (www.foodmandu.com) is popular with both expatriates and local residents, with competitor http://www.foodmario.com/ offering similar service. Sastodeal and Daraz are emerging online shopping portals (https://www.sastodeal.com/https://www.daraz.com/). Over the pandemic, a number of eCommerce service-providers have also extended their services to include grocery and food delivery services, such as the ride-hailing service Pathao.
Websites facilitating electronic commerce are mostly based outside Nepal, where credit card verification services are readily available. Credit card transfers and transfers from e-banking websites are accepted, but many Nepalis do not have dollar accounts and cannot make payments in foreign currency. Foreign exchange is tightly regulated and not freely available. Nepali retailers have few options available for online payment, although many companies now claim to offer mobile payment solutions for domestic purchases. Many eCommerce services operate on the basis of cash payments at the point of delivery.
Almost 60 percent of Nepalis have access to the internet, with more than 95 percent of users accessing it through mobile phones. There are opportunities for retailers to promote mobile eCommerce.
Few firms in Nepal use digital marketing, but as more Nepalis acquire smart phones, opportunities in this field are growing.
Major Buying Holidays
Nepal’s biggest holidays – Dashain and Tihar – are separated by about three weeks. Their timing fluctuates, but Dashain usually falls in late September or early October, while Tihar is in late October/early November. Many Nepalis return to their home villages during this time.
Nepalis are embracing social media. Embassy Kathmandu’s combined Facebook page and Twitter account have nearly 8 million followers – significantly more than the circulation of all daily newspapers combined. Over 70 percent of Nepal’s population is under the age of 35, which suggests that the number of social media users will continue to grow.