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The Status of E-commerce in Egypt

Egypt is one of the main forces behind the fastest growing MENA e-commerce market.
E-commerce market in the Middle East is the fastest growing in the world and Egypt is one of
the main forces behind that growth. The 2014 State of Payments report issued by Payfort

highlighted the opportunities in the rising Arab market in which e-commerce payments expanded by 45 percent in 2013.

Egypt, Saudi Arabia, United Arab Emirates and Kuwait are the main drivers behind this growth with 30 million online shoppers. These numbers come despite the low internet penetration in the region (35 % only) and thus this market is expected to grow exponentially within the next 3 years.

Egypt has the largest population in the Arab world and the highest number of Internet users.

Although the internet penetration in Egypt saw an increase of 400% between 2004 and 2014 reaching 44 percent, only a little more than 3000 people are transacting online.

The majority of online transactions carried out by Egyptians falls in the categories of electronics, airline tickets and fashion. Demographics of these transactions show that 75 percent of users are in their 30s or less and half of them are located in Cairo.

The biggest challenge ahead of E-commerce in Egypt and the region is the low number of credit cards holders. In Egypt only 7 percent of the population is banked and only 7.6 million people have credit or debit cards. 80 percent of e-commerce in Egypt relies on cash on delivery.

However, the rate of credit card issuance is growing annually by more than 40 percent, which indicates that cash dependency may decrease.

Egypt also came in first with regards to the e-commerce basket size. Credit card orders increased by 36% in 2014 (from 71$ to 96$) while cash on delivery orders increased by 16%.

The Arab e-commerce market is expected to keep booming during the next decade with the

number of devices connected to the internet expected to reach 50 billion devices by 2020.

Countries like Egypt and Saudi Arabia are expected to be the main forces behind the growth with a massive increase in internet and credit card penetration.

For more information click the infograph here

Image via Shutterstock.