Sri Lanka - eCommerce
Describes how widely e-Commerce is used, the primary sectors that sell through e-commerce, and how much product/service in each sector is sold through e-commerce versus brick-and-mortar retail. Includes what a company needs to know to take advantage of e-commerce in the local market and, reputable, prominent B2B websites.
Overview
eCommerce is growing. All commercial banks have online banking services.  Travel companies, hotels, and a few large retailers have online trading services.  Sri Lankan eCommerce companies offer customers in Sri Lanka access to millions of global products. The Government is also encouraging e-services. A main eCommerce portal for automated cargo clearance has been established. Further Government web portals for filing of tax returns, payment of taxes, renewing of revenue licences are also avalible in Sri Lanka. Most of the global eCommerce sites including PayPal is available in Sri Lanka but has limitations due to an inadequate refund mechanism and inward receipts. A 2.5 percent stamp duty applies to usage of credit cards issued by Sri Lanka banks for transactions converted into a foreign currency. Transactions in local currency are exempted from this duty.
 Current Market Trends
IT related activities have seen a significant growth of about 21 percent in 2015, compared to just nine percent the year before. A significant portion of this growth can be accredited to eCommerce. Currently there is no local body which regulates eCommerce businesses in Sri Lanka.

Increased competition from international eCommerce sites such as booking.com and Airbnb concerns have resulted in demands by the Tourist Hotels Association of Sri Lanka (THASL) for government to consider regulating eCommerce businesses.
Domestic eCommerce (B2C)
Domestic eCommernce sites have seen a significant growth since within the last several years. A wide variety of consumer products can be purchased through eCommerce sites including groceries, apparel and electronics. It is noted that most delivery of goods from these sites are limited to Colombo and its suburbs.
Cross-Border eCommerce
Cross border eCommerce is limited to purchases of products from popular overseas sites such as ebay and Amazon. Numerous local eCommerce companies sell imported goods.

B2B eCommerce
Currently there are no B2B eCommerce sites which are operating in Sri Lanka.

eCommerce Services
The Internet penetration in Sri Lanka is growing, granting more people access to the World Wide Web. 2016 figures show 33.4 percent of the population have acess to the internet. This is mainly attributed to the growth of Sri Lanka’s mobile industry. The country now has a mobile penetration of 115 percent, with the accessibility of smartphones growing rapidly.

In 2006 the Electronic Transactions Act, No.19 was introducted which facilitates eCommerce by removing legal barriers and ensuring legal certainty both within Sri Lanka and internationally. Several other laws also support eCommerce such as the Evidence Act of No 14 of 1995, Payment and Settlement Systems Act No 28 of 2005, Payment Devices Frauds Act No 30 of 2006 and the Computer Crimes Act of No 24 of 2007. However, there are still gaps in laws relating to eCommerce.  Following the ratifcation of the UN Electronic Commissions Convention by Sri Lanka in 2015, the Government is preparing to introduce amendments to the Electronic Transactions Act to provide greater legal validity for eCommerce and eBusiness providers, and ensure international validity of such e-contracts.
While awareness of online shopping is growing, financial institutions are also developing the related services of payment gateways to offer reliable online payment services to support the expansion of eCommerce.

The Government is currently using an e-service gateway to streamline certain Government services. The Inland Revenue Department has recently enabled filing of tax returns through the Inland Revenue web-service portal. Vehicle revenue licenses can be renewed online.

eCommerce Intellectual Property Rights
eCommerce Intellectual Property Rights are protected under several laws:
Evidence (Special Provisions) Act No.14 of 1995; The Intellectual Property Act No. 36 of 2003; Electronic Transactions  Act No. 19 of 2006  and the Computer Crimes Act No. 24 of 2007.

An infringer who offers counterfeit products for sale online could be held liable under the Intellectual Property law.
Popular eCommerce Sites
• Kapuruka.com
• WOW.lk
• Takas.lk
• MyDeal.lk
• Keells Super
• Ticketslk
Online Payment
• Cash on Delivery: The most commonly used payment method in Sri Lanka. As per estimates, more than 95 percent of eCommerce users in Sri Lanka prefer the cash on delivery (COD) payment model.
• ezcash / mcash: Some eCommerce websites also prefer these payment models for transferring small amounts of mondy through a mobile service provider.
• Credit Card: Most of the eCommerce websites in Sri Lanka have merchant accounts integrated on portals to facilitate credit card transactions. This is the preferred method for overseas purchases.
Mobile eCommerce
Mobile eCommerce is still in its initial stages. With the growth of smartphone usage mobile eCommerce is expected to grow in the near future.

Digital Marketing
The use of text messaging is increasing in Sri Lanka. Due to high mobile phone penetration at 115 percent, rather than cold calling, sending a text about a product or brand is becoming more widely used in Sri Lanka. A recent survey shows that marketing through Facebook has influenced 79 percent of the users to purchase the products.  Social media marketing is expanding as well.

Major Buying Holidays
There are no major buying holidays currently in Sri Lanka. Most popular shopping periods include local New Year during  April and Christmas holiday period in December.

Social Media
Facebook is very popular in Sri Lanka. As per the statistics provided by Sri Lanka Police, Sri Lanka has over 1.2 Facebook users. Twitter, Instagram and LinkedIn are also used by Sri Lankan, however, not to the extent of Facebook.
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.

Leading e-commerce Companies in Sri Lanka

Over the last decade, e-commerce sales have grown on average 19% per year globally, far faster than offline retail. Even during the dark days of 2009 on the international level when retail sales shrank 2%, e-commerce vendors grew sales 1.4%, capitalizing on price-sensitive and increasingly Web-savvy consumers to continue to gain market share. So while traditional retailers have been struggling to survive, forward-thinking online merchants have unleashed a wave of innovation that is improving the economics of e-commerce.

In last few years, e commerce in the South Asian region has grown at a phenomenal rate. The ecommerce boom is resulting in a sudden explosion of interest in the sector. In addition to the numerous local e-commerce sites, many brick and mortar companies are jumping on the bandwagon as well. A majority of such traditional brick and mortar companies have not even had a company website until now, and e-commerce will truly be their first taste of what the world of Internet and e-commerce can offer. In this article, we would be analyzing the leading ecommerce companies in Sri Lanka that are having a huge impact in shaping the retail business on internet.

1 . Kapruka.com

Kapruka.com is Sri Lanka's largest e-commerce organization with a market share of 70% in the e-commerce sector and is recognized as the pioneer in Sri Lankan e-commerce industry. With its own fulfillment service and unique inventory, it is the most trusted name when it comes to ecommerce in Sri Lanka. The company started with a single employee, and within a very short span, it has more than 200 employees, who are ensuring to provide the consumers with over 15000 products and over 30 types of distinct services, and thus setting the bar for e-commerce footprint in Sri Lanka.

In addition to providing products and services through traditional e-commerce, Kapruka also pioneered a new online platform named Kapruka Global Shop that enables Sri Lankans to order any item from global e-commerce giants such as Amazon, E-bay, Flipkart, and Alibaba. Kapruka has developed a patented online price simulator that shows a clear breakdown of Sri Lanka's taxes and duty for a given online product link.

It also offers a huge variety of products in competitive departments such as electronics, clothing, homeware, stationery, mobile phones, computer accessories for same or lower price than store by retailers.

Kapruka user-friendly shopping website is also a feature for which they are known. The website always indicates very current and up to date information about the products available in their store and is a convenient option for those living both Sri Lanka and abroad to make purchases or to deliver gifts to loved ones in Sri Lanka for special occasions such as birthdays and anniversaries.

2. Myshop.lk

is one of Sri Lanka's youngest and fastest growing e-commerce websites that provides the online shoppers the facility to shop at their convenience and offers a constantly expanding range of Retail Electronic Categories, Cosmetics, Fancy items and much more. It provides a Safe Online Shopping environment and offers various payment options and secure warranty commitments as well.

MyShop.lk are the pioneers of showroom-based online shopping malls in Sri Lanka. What they do is that, at any given time, all products are displayed on their online store, and all these products are also available at their physical store as well. The reason is that, if ever they feel the need, customers can visit the store and ensure that what they see is what they get.

MyShop.lk is becoming popular among its customers due to its wide array of product offerings, value for money, timely delivery, easy payment modes and outstanding customer service.

3. Wow.lk

Wow.lk is one of the very first websites in Sri Lanka that offers a wide range of deals, original products with warranty, multiple payment options and island wide delivery, striving to offer its customers the complete shopping experience.

After its establishment in 2011, the company has since grown into a leading e-commerce company active in Sri Lanka's industry, catering to both international and local consumers. It is utilizing a highly skilled and experienced team of professionals, that in performance with the extensive resources of wow.lk, provides e-commerce experience to both merchants and consumers across a variety of products and services.

The online mall of Wow.lk has a catalog of over 3,500 products, from over 100 recognized retailers. It gives consumers the opportunity to order from a broad selection of original merchandise and big brands from international and local sellers, with warranty and island-wide delivery. The Mall has a variety of secure payment methods such as Credit Card transactions, Cash, Pay on Delivery, EZ Cash, and direct operator billing.

4. MyDeaI.Ik

MyDeal.lk is another leading e-commerce competitor in Sri Lanka that offers daily deals on the stuff to do, eat, see, stay and buy online. Using its websites, it connects buyers and sellers in a way it claims to be a win-win situation for both parties. While consumers enjoy great deals and share them with family and friends via word-of-mouth and viral marketing, merchants gain new customers and publicity at zero risks.

MyDeal.lk is an e-commerce venture that focuses specifically on selling deals. Modeled on the Groupon concept, the website sells discount vouchers from suppliers of a variety of products. These range from the usual electrical items and kitchen appliances to clothes, shoes, cupcakes, mugs, hotel rooms, restaurant tables, movie tickets and even helicopter rides. Customers book "vouchers" online and print them out to pick up items from the MyDeal store, claim delivered goods, or — in the case of travel, entertainment and other experiences — present to suppliers.

MyDeal founders imply they are satisfied with the ten-percent of available market space they have captured with 500,000 registered users since the end of 2012 to date, but the scale is essential for the sustenance of e-commerce businesses, and in that regard, Karpuka has a huge advantage.

5. Takas.lk

The word "Takas" means quickly, and Takas.lk is promising delivery in Colombo and other suburbs within three days. Takas is one of the first Sri Lankan e-commerce company to offer mobile friendly websites in Sri Lankan e-commerce industry.

Since its inception, Takas.lk has grown to one of the top contenders in the eCommerce industry in the island with more than 4000+ electronics products now which you can choose from, and 2000+ products in areas of apparel, personal care, car care, home appliances just to name a few.

Takas. 1k provide a very easy to use platform for the consumer to buy online. Being the pioneer's in introducing Cash on Delivery to Sri Lanka, it gives the users the facility to use either cash or card to purchase. Fu rthermore, takas.lk have 0% financing from some of the major banks in Sri Lanka thus giving the convenience of letting you buy what you want and paying how you want.

Another advantage it has got is the fact that regardless of where you live in Sri Lanka, you get the product delivered right to your doorstep.

 

Sources cited

PwC's Annual Global Total Retail Consumer Survey February 2015

http://www.ceylontoday.lk

http://www.dailymirror.lk/94943

http://echelon.lk

http://echelon.lk/home/e-commerce-in-sri-lanka/

https://www.kapruka.com