The e-commerce sector dominated headlines in 2021 for controversial business models operated by a few platforms, sending the entire sector in a crisis throughout the year.

After billions of taka got stuck with some online shops, the customers took to the streets. The ministry is yet to find out a way to refund the money to the victims.

“The Escrow services have been introduced to safeguard the interest of the consumers amid the e-e-commerce scams,” additional secretary AHM Shafiqul Islam, designated person for e-commerce sector at Ministry of Commerce, told the Daily Sun.

He said the e-commerce sector gained momentum alongside a few anomalies created by some platforms.

Ecommerce Association of Bangladesh (E-Cab) data shows that there are around 1600 registered companies under the umbrella of the trade body while the market size is around Tk 160 billion.

In the last week of 2021, a high-level meeting was held among the top policymakers from Bangladesh Bank, police, commerce ministry, payment gateway providers and e-commerce platforms to discuss ways for addressing the issues facing the e-commerce sector.

“In the December 28 meeting, the discussants learnt that around Tk 3.97 billion customers’ money is stuck on foster payment gateway. Of which, Qcoom had delivered products to customers. We predict, around Tk 3 billion is yet stuck on the payment gateways. The e-commerce platform and payment gateway promised to submit a report on January 10. Then we can start the refund process partially,” added the additional secretary.

Controversial platform Dhamaka illegally laundered Tk 4.7 billion abroad, according to a report of Bangladesh Bank sent to the Ministry of Commerce on December 27.

The officials acknowledged that the ministry has received the investigation report from Bangladesh Bank on financial anomalies of Dhamaka Shopping.

The regulatory actions started gearing up from the third quarter of 2021 when Evaly’s CEO Mohammad Russell and chairperson Shamima Nasrin were arrested on charge of fraudulent practices after a customer filed a case against them. In the third quarter of last year, the High Court formed a four-member board of Evaly led by former Appellate Division Judge AHM Shamsuddin Chowdhury Manik. Former bureaucrat Mahbub Kabir was appointed as managing director of the scam-hit e-commerce platform.

Commerce Ministry issued show cause notices to four e-commerce companies – Tholey, Dalal Plus, Anander Bazar and Alashpar for running fraud campaigns in October.

In the last week of August, the commerce ministry sought information from Bangladesh Bank about financial transactions of nine e-commerce companies – Alesha Mart, Dhamaka, E-orange, Sirajganj Shop, Aladiner Prodip, Qcoom, BoomBoom, Adyan Mart and Need.com.bd.

Former BASIS President Fahim Mashroor said 2021 was a learning year for the e-commerce industry as most of the policymakers made bubbles to help the scammers.

“Most of the growth rate was artificial. When the bubble blasted out, the real scenario came to light. However, I think, the introduction of Escrow service helped to control the destructive situation,” Fahim, also CEO of AjkerDeal, told the Daily Sun.

He also suggested reconsidering the 51 percent local stake for investing in e-commerce.  According to industry insiders, around 90 per cent of e-commerce deals are now taking place under the cash-on-delivery method.

The government released a standard operational procedure (SOP) for the e-commerce sector as a gazette on July 4 last year.

The customers and e-commerce platforms are facing issues with financial transactions as the activities of logistic service providers remain out of the radar of the traditional escrow service of Bangladesh Bank.

The Postal Department is working on the development of a central monitoring system for supervising the real-time activities of the logistic service. Under the system, the regulatory bodies can track the parcel of any courier service from anywhere, according to the official.

Numerous e-commerce firms opened for business in the past one year, joining a handful of platforms that started operations after Bangladesh Bank launched National Payment Switch for online transactions in 2012.