Indian Online Retail Market to touch $17.50 billion

As the Indian economy is growing at a very fast rate, two sectors that are seeing tremendous uptrend are the banking sector and e-commerce. We see a huge surge in demand for finance from small-scale and large-scale enterprises alike. Banks, credit card companies and other financial institutions are extending loans and advances to individuals and small businesses. There is a huge collection and recovery process that is generally outsourced by most of the banks.

Most of the banks have automated Core Banking functions. Their collection process grossly remains manual, maybe because it is outsourced to collection agencies and they have not been deploying technology because of the rising project expenditure.

At the same time, the B2C e-commerce market in India has exhibited rapid growth and is expected to reach $60 billion by 2017. The online channel is expected to grow at a much faster rate vis-a-vis more established channels and is expected to account for 10.1 per cent of overall retail sales in 2018.

Going forward, the sale of fruit & vegetables and groceries continues unabatedly despite the introduction of GST. Buyers are now quite comfortable ordering apparel, shoes, and electronics goods online. With online payments, selling groceries online has become relatively easy. With a large customer base and increasing penetration of Internet connectivity and growing popularity of online shopping, many e-stores have come up. Very soon, it will emerge as another billion dollar market and most of the existing e-tailers offer their service in metros and major urban centres.

People feel comfortable buying even milk, bread and eggs online. The online grocery segment is projected to witness a strong growth over the next few years. Large business houses are entering this sector, including Tata Group by acquiring Gurgaon-based GrocerMax. Secondly, Amazon has inked 60-day exclusivity agreement with BigBasket for potential acquisition and Bangalore-based e-grocer has raised nearly $250 million and registered over three-fold increase in revenue and Paytm is planning to join forces with its investor Alibaba to pick up a minority stake in the online grocery retailer BigBasket for about US$200 million. With this, this sector seems very promising. Most retailers are trying to provide a multichannel offering that meets the demands of customers, who easily switch channels to buy products and the entire process is getting automated using the next- generation software tools and technologies.

Lastly, the year 2017 will see phenomenal growth and by the end of 2018, Indian e-retail is expected to grow at the rate of 15% to touch $17.50 billion with increasing participation from people across the country. This industry will continue to generate more employment opportunities and contribute towards creating more entrepreneurs.

Tags: Indian Online Retail Market, gst, amazon, alibaba, B2C e-commerce market in India