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How Rwandan Small Businesses Embrace E-commerce

Dec 08, 2023 10:00AM ● By Gift Joe

Central Kigali, Rwanda. Source: Wikimedia Commons

Picture a world in which every purchase demands your physical presence, where loved ones from afar cannot surprise you with gifts, and where you have to squeeze out time from your busy schedule to go and get an item from the store while being uncertain if it will be available. That is a world without e-commerce.

Thanks to technology, the world has become increasingly digital, altering how we purchase and consume goods and services. In this new digital revolution, e-commerce has become an essential and complementary part of traditional trade. Businesses are beginning to embrace e-commerce as customers no longer need to queue in shops to buy what they need. E-commerce serves as a new distribution channel with lower barriers of access to markets that can empower entrepreneurs and enterprises.

One of the countries that has been at the forefront of the shift towards e-commerce in Africa is Rwanda. Its government embraced new policies, strategies, and investments in infrastructure for information and communication technologies, which will be leveraged for the success of e-commerce.

The government through the Ministry of Trade and Industry has put together an e-commerce policy and strategy to regulate and encourage entrepreneurship. The vision is to transform Rwanda into a regional e-commerce hub on the strength of its technology, payments, and logistics infrastructure and human capital; a hub accelerating innovation, boosting regional and international trade, and supporting all sectors of the country’s economy to create jobs, increase personal income and improve living standards. The mission statement of the Rwanda e-commerce policy is to build a robust, safe, and enabling e-commerce ecosystem for socio-economic transformation.

What are some initiatives put in place by the government of Rwanda to boost e-commerce?

E-Government Services: Rwanda has been investing in e-government services to facilitate online transactions and streamline government processes. The E-Government platform allows citizens to pay their taxes, register businesses, obtain national identity cards, and much more.

Smart Rwanda Master Plan: Developed by the government in consultation with representatives of civil society and the private sector, the plan includes initiatives to leverage technology for economic development, as well as fostering investments, innovation, and creative local content for the promotion of e-commerce.

National Fiber Optic Backbone: This provides high-speed internet connectivity to businesses and individuals in Rwanda. This has helped to increase internet penetration in the country, ensuring that the necessary digital infrastructure is in place to support the growth of e-commerce activities.

Digital Literacy Programs: The government of Rwanda has implemented programs to enhance digital literacy among nationals. A digitally literate population is crucial for the widespread adoption of e-commerce.

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Businesses Embracing E-commerce in Rwanda

MurukaliFounded by Yvette Uwimpaye, this is one of Rwanda’s pioneer e-commerce startups and has been in operation since 2015. It boasts a clientele spanning the US, Australia, Switzerland, Uganda, and Kenya.

Made in Rwanda: Leah Uwihoreye, a computer engineer, founded Made in Rwanda. The e-commerce platform connects women artisans to online markets.

Yubeyi: Christophe Nkurunziza is the brain behind this e-commerce business focusing mainly on electronic equipment like mobile phones, laptops, blenders, and fridges, just to name a few.

Kasha Rwanda: Joanna Bichsel is the CEO of this e-commerce platform focusing on health, hygiene, and personal care products for women in Rwanda and Kenya. The platform caters to individual consumers, small resellers, hospitals, pharmacies, and clinics, providing essential products like contraceptives, sanitary pads, and pregnancy tests.

Vuba: This is one of Rwanda's leading e-commerce platforms. It provides a convenient solution for residents in Kigali and other parts of the country to order meals and daily essentials for delivery to their homes or offices within 1 hour.

GroceWheels: This was one of the first e-commerce platforms in Rwanda. It allows people to grocery shop online and have the items delivered straight to their door.

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Benefits of Leveraging E-commerce in Rwanda

E-commerce can be a ‘win-win’ strategy for businesses and consumers. Below are some of the benefits.

Market expansion: Businesses in Rwanda can reach a broader audience beyond local boundaries. This expanded market reach can lead to increased sales and growth opportunities.

Saves cost: Businesses can reduce expenses related to physical storefronts, staff, and utilities, leading to cost savings.

Limited workforce: Sellers can keep their workforce very lean because only a few people will be needed to carry out the day-to-day running of the business.

Cashless society: E-commerce promotes the use of digital payment methods, contributing to a more cashless economy.

24/7 access: Consumers can get what they want at any time without compromising on other responsibilities, where they have to create time out of their busy schedule for shopping despite the activity not requiring their presence.

Job creation: E-commerce leads to job opportunities in various sectors, including logistics, IT, digital marketing, and customer support. This contributes to economic development and improved livelihoods.

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Obstacles Faced by Rwandan Small Businesses In Transitioning to E-commerce

Limited Internet penetration and access: Unreliable Internet connectivity may hinder small businesses from establishing a robust online presence and conducting smooth e-commerce transactions.

Rising barriers to cross-border e-payments: Unfortunately, there are still many challenges with payment corridors. Some of the issues include incredibly high costs and considerable delays. Some are not even fully accessible to all.

Poor ICT literacy, awareness, and knowledge of e-commerce: Some small business owners may lack the necessary skills and knowledge to navigate the complexities of e-commerce.

Resistance to change: Not everyone is open to adopting new technologies and processes. Some small business owners and employees who are accustomed to traditional methods of operation may not be willing to transition.

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