Africa’s Largest Online Marketplace Bidorbuy Adds Bitcoin Payments
To eliminate the financial security issues a lot of African e-commerce users have suffered from, Bidorbuy, Africa’s largest online market, began accepting Bitcoin payments March 3.
The integration of Bitcoin relieves e-commerce platforms from storing sensitive financial data on their local servers, reducing the risk of a data breach and leak of personal user information. By providing Bitcoin as one of its main payment methods, Bidorbuy aims to lead the growth of the e-commerce industry in Kenya and South Africa.
Bidorbuy has more than 700,000 items listed on its online marketplace and generates more than 30 million page views per month. It is the largest corporation in the South African and Kenyan e-commerce industry by market share and the size of userbase.
The e-commerce market of Kenya is growing at a rapid pace. According to the Communications Authority of Kenya, the data/Internet market in the country has grown exponentially since 2014, due to the increase in smartphone adoption rate and speed of bandwidth Internet connection across Africa.
“All sub-categories of data/Internet service demonstrated growth apart from the terrestrial wireless service which recorded a drop in the number of subscriptions during the quarter. This was as a result of the on-going migration of wireless subscribers to fiber network by some of the major data/Internet providers. Emergence of new markets such as e-Commerce will present a prime opportunity for the market to make a turnaround and begin to record growth as it provides physical delivery services for online transactions,” said the Communications Authority of Kenya.
The country’s e-commerce platforms, including the popular OLX online marketplace, have experienced a huge growth momentum in Africa. OLX Kenya manager Peter Ndiang’ui says the establishment of stable Internet connections and the emergence of affordable smartphones led the African e-commerce industries to achieve significant milestones over the past year, especially daily purchase volumes, market share over traditional markets such as the retail industry and the number of newly registered members on online marketplaces.
“All those services [available on e-commerce platforms] are having a huge growth momentum in Africa and specifically in Kenya. The biggest driver is the access to smartphones. Smartphones have become cheaper, and Internet access has spread with broadband spreading much more wider,” said OLX Kenya Manager Peter Ndiang’ui.
Visa South Africa General Manager Jabu Basopo explains that an increasing number of e-commerce platform users are starting to purchase more airline tickets and clothes online to eliminate the inconvenience of visiting retail shops or travel agencies at traffic heavy hours.
“If we look at the trends, the top three areas that are growing are electronics, fashion and airlines. However, each market differs. In some markets you’d see probably the airlines being number 1 [growing area],” said Visa South Africa General Manager Jabu Basopo.
Despite the rapidly growing clientele of many e-commerce platforms, one major issue with Kenya and other African countries’ online marketplaces that is restricting the potential expansion of the e-commerce industry throughout Africa is poor financial infrastructure and vulnerability of credit card payments.
Kenya’s leading online electronics marketplace Kilimall marketing manager Charles Mungai says a lot of users of e-commerce platforms have had their sensitive financial information and credit card data leaked over the past few years. Since e-commerce platforms manage centralized local servers or databases of sensitive user data and financial information, users’ credit card data are prone to hacking attacks and data breaches. If a hacker or a group of hackers gain access to an e-commerce platform’s servers, users’ financial data will inevitably become leaked.
“A lot of people have got themselves into very nasty situations because of issues with credit cards, fraud and financial insecurity. For example, you give credit card information on a platform that was not very secure and somebody takes that information,” said Charles Mungai, Marketing Manager of Kilimall.
The increase in financial fraud and consumer insecurity associated with credit cards and traditional means of payment have led a substantial part of Kenya’s population to refrain from using online payment tools in purchasing goods online. By incorporating Bitcoin into its online platform, Bidorbuy hopes to initiate a trend back toward e-commerce.
The article first appeared in the Bitcoinmagazine