The Country of Uganda Using eCommerce Platforms to Overcome COVID-19

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On the outskirts of Uganda’s capital of Kampala, David
Akanshumbusha sells groceries at a stall in Nakawa market. He’s
also on
SafeBoda
, which is a motorcycle (‘bodaboda’) taxi hailing
app that recently launched an e-commerce platform by connecting
market vendors with customers; this was a result of Uganda going on
lockdown to control the spread of CoVID-19. Customers place orders
through the SafeBoda app and pay through its mobile wallet feature.
Later, riders that are based at the market would deliver the
groceries.

“Thanks to the app, I now have more customers than ever
before,” Mr. Akanshumbusha said. The ‘bodaboda’ hailing app
that has evolved into an e-commerce platform has boosted sales for
him and hundreds of other small traders, benefiting thousands of
customers as well. SafeBoda and other e-commerce platforms have
seen a triple-digit increase in business following the outbreak of
the pandemic. By giving market vendors access to the app, it allows
them to sell goods while sustaining the livelihoods of 18,000
‘bodaboda’ riders whose incomes have been affected by the
pandemic.

The app’s e-commerce platform is the result of a
partnership
between the United Nations Capital Development Fund
and SafeBoda Uganda, with support from the Swedish International
Development Cooperation Agency. E-commerce platforms such as
SafeBoda are helping soften the economic blow of CoVID-19. And the
Ugandan government is helping them flourish by fostering an
enabling environment for e-commerce and the digital economy, in
line with recommendations of an
UNCTAD eTrade Readiness Assessment
.

The country of Uganda is using e-commerce platforms to overcome Co-VID 19 by Richie SantosdiazThe country of Uganda
is using e-commerce platforms to overcome Co-VID 19 (pictured Mr.
David Akanshumbusha) IMAGE SOURCE PROVIDED

“We are pleased to see such collaboration between different
stakeholders,” said Shamika N. Sirimanne, UNCTAD’s director of
technology and logistics. “They show the importance of
public-private cooperation with development partners.” Ms.
Sirimanne said the collaboration shows the added value of partners
under the
eTrade for all initiative
, which empowers developing countries
to benefit from e-commerce.

Uganda’s real gross domestic product (GDP) growth this year is
projected to hover below 2% compared with almost 5.6% in 2019 due
to CoVID-19, according to
the World Bank
. As part of its response to the pandemic’s
economic fallout, the Ugandan government is at the forefront of
promoting e-commerce and digital solutions for faster recovery from
the crisis.

For instance, it has worked with mobile phone operators to
reduce fees for digital services and offer complementary internet
data packages to consumers to facilitate cashless transactions.
It’s also using digital media to disseminate health messages and
fight misinformation. Besides, the government is strengthening
public-private sector cooperation to improve trade logistics and
enhance the supply of digital services, in line with UNCTAD’s
recommendations.

Ugandan authorities are also bolstering entrepreneurship by
supporting innovation and start-up-driven solutions. Further, the
country has boosted internet connectivity by extending
infrastructure that has enabled firms to lower the costs of their
services.

Uganda is also improving trust in online transactions. Last
year, it enacted a data protection and privacy law to enhance the
security of these transactions. An e-payments law recently approved
by the country’s parliament is expected to come into effect soon
to level the playing field for providers. In addition, Uganda plans
to develop a national e-commerce strategy with support from the
United Nations Development Programme (UNDP). “We’re banking on
e-commerce to catalyse innovation, growth and social prosperity in
the digital economy,” said the country’s minister of trade,
industry and cooperatives, Amelia Kyambadde.

Uganda has seen a boom in e-payment solutions in recent years.
Between 2015 and 2019, mobile money transactions in Uganda more
than doubled in value, from about $9 billion to $20 billion,

according to the country’s central bank
. CoVID-19 has
amplified the uptake of e-payments and growth of local fintech
solutions. Among the beneficiaries of the growth is
Xente
, an e-commerce and financial services mobile app with
more than 50,000 subscribers. It allows people to buy goods from
marketplaces using methods such as mobile money, credit cards or
bank transfers, and to access loans within the app.

Following the CoVID-19 outbreak, the company waived set-up and
commission fees for small businesses for three months. This saw it
record a 10% increase in business-to-consumer transactions and a
200% jump in business-to-business turnover, said its chief
executive officer, Allan Rwakatungu. The company also launched a
new service to ease online and mobile transactions and payments for
micro, small and medium enterprises (MSMEs) hardest hit by
CoVID-19.

In another partnership, food delivery startup
Jumia Food Uganda
joined forces with UNDP to boost its
services, introducing contactless delivery and cashless payments in
response to the pandemic.
Under the partnership launched in May
, UNDP aggregates seller
groups and provides technical assistance to improve the firm’s
capacity in packaging, tracking sales and technology adoption.

Over 3,000 market vendors from seven markets are now connected
and selling their produce on the Jumia platform. More than 60% of
them are women, people with disabilities and the youth. “Such
partnerships help build the capacity of MSMEs through market-based
digital solutions,” Ms. Sirimanne said. “We need more of them
to strengthen e-commerce and digital ecosystems across
Africa.”

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The Country of Uganda Using eCommerce Platforms to Overcome
COVID-19
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