Cover page

Contents
1. Introduction............................................................................................................................1
A. Ecommerce in Nepal...................................................................................................1
i. Background..................................................................................................................1
ii. Growth of ecommerce in Nepal..................................................................................1
iii. Current Practice of ecommerce in Nepal.................................................................2
iv. Trends of ecommerce in Nepal................................................................................2
2. Historical Background...........................................................................................................4
B. A. Evolution................................................................................................................4
v. 2) B2C.........................................................................................................................8
A. Benefits to Organization..................................................................................................11
i. International market place.............................................................................................11
vi.......................................................................................................................................11
vii. Benefit to society...................................................................................................12
6) Limitation of Ecommerce....................................................................................................14
7) Ecommerce sites in Nepal....................................................................................................16
C. Payment method while conducting ecommerce in Nepal.........................................16
viii. 8) Future of ecommerce in Nepal..........................................................................18
 1. Introduction
E-commerce means electronic means of doing business transactions between two persons. E-
commerce is the electronic medium of buying and selling of goods and services through
internet access like online transactions. It is the digitally enabled commercial transaction
among or between individuals and organizations. It is a modern method of doing business via
internet network or digital network E-commerce is not just about buying and selling of goods
and services, it is also about communicating to various sources electronically, discovering
new information, learning electronically and many more. Ecommerce have a significant
impact on significant portion of world affecting people, professions and businesses.

A.Ecommerce in Nepal

i. Background
Internet is one of the basic need of people in today’s generation. Internet has changed the
method of doing business. E-commerce is now a major part of internet. All most all the
business of the whole world is done electronically and online. The world now relies on
internet, so everyone relies over internet. It is very easy to use internet and to do online
businesses transactions.

The various business in Nepal is still in traditional practice. E-commerce is still immature in
Nepal. There are various sites of ecommerce but Even though the various websites like
www.kaymu.com,www.muncha.com are doing well, they still lack public exposure. There
are many companies in Nepal who have started the trend of ecommerce in Nepal but they
face various challenges. There is no proper knowledge of doing online business in Nepal.

ii. Growth of ecommerce in Nepal

The ecommerce business in Nepal was promoted by various international countries like USA,
UK, Europe etc. Nepal is a developing economy and improving in the economic growth. This
economic growth can be attributed to the flourishing ecommerce sectors in Nepal. Nepal is
slowly achieving success through ecommerce with the use of improved technology and
skilled manpower. Online shopping is taking the market of Nepal in the rapid growth as it is

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 also facilitated by 3G and 4G internet facilities. Ecommerce is Nepal is growing in a rapid
pace as people started buying things through internet platforms and online shopping. Many
people in Nepal have started visiting the ecommerce websites for the transactions. The
ecommerce sector of Nepal is still in its initial phase but also various Nepali websites are
playing an important role in the growth of Nepali industry.

iii. Current Practice of ecommerce in Nepal

In Nepal, various online websites and online shopping are developed. Ecommerce is
developing in a very rapid pace. Nepali ecommerce industry is turning around with the use of
improved technology, improved payment system, security etc. There are various Nepali
websites but facing the problem of payment and advertisement. They still have a belief of
people and level of trust to build among the website visitors. Some of the famous online sites
also deliver the goods and services internationally. Therefore, Ecommerce in Nepal is
developing day by day by the various online facilities like discount, delivery, multiple
choices, price comparison etc. that will help to bring positive growth in the Nepali Industry.
Ecommerce is on the progressive path.

iv. Trends of ecommerce in Nepal

The way of doing business in has completely changed by internet. The Trend of doing
electronic business transaction has also started in Nepal. There are various online websites in
Nepal as to help the consumer shop easily. Online shopping helps the consumer to get
everything they want within a single online shopping site at any time at any place. The trend
of doing electronic business in Nepal is increasing day by day. Ecommerce application has
made easy for the consumers to buy and sell the products online. Some of the top online sites
in Nepal are kaymu.com, meroshopping.com, hamrobazar.com etc. these sites provides a
large varieties f products to the consumers.

According to the report of shopping trend in Nepal, Male people do more online shopping
than female. About 72% of the people buying online are male and only 28% are females. It
seems that females are not much connected to the online sites rather they buy fro physical
stores after proper examination of the products. It is also seen that most of the online
transactions are operated on Tuesdays. People tend to buy more products on Tuesday rather
than other day. However the trend of ecommerce in Nepal is on growing phase as most of all
the bigger and small organizations are getting online. They are promoting people to do the

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online transaction through various marketing strategies like discounted, buy one get one free,
deals, offers etc. Thus, the ecommerce industry is playing an important role in influencing the
shopping behaviour of Nepal.

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2. Historical Background
Commerce is the process of buying and selling of goods and services between and among
individuals and organizations .Before the introduction of ecommerce, traditional commerce
was in the practice. E-commerce has started 40 years ago in the early 1970s.The Ecommerce
application has developed with electronic fund transfer.  Ecommerce was first coined in the
early 1990s and then internet became worldwide and commercialized. Thereby, the users
began to use internet and flocking to participate in World Wide Web. The rapid use of
electronic commerce as expanded. However there was only limited use of electronic
applications by business offices, organizations, financial institutions, large corporations
etc. Since 1995, many innovative applications, ranging from direct online sales to e-learning
experiences had been developed. Almost every organization in the world has a Web site

B.A. Evolution

Ecommerce as entirely evolved in the last twenty years. It has evolved from the traditional
way of doing business to the modern way of purchasing goods and services through
electronic medium. The development of various technologies and innovative applications has
started since 1995. Various applications ha online shopping, e-learning has been developed.
Now, almost all the organizations and business institutions have their own web sites.

In 1999, Business to Business model has started. The emphasis of ecommerce shifted from
B2c to B2B.

In 2001, the emphasis of ecommerce ten shifted from B2B to B2E, electronic government,
electronic learning and mobile ecommerce.

In 2005, ecommerce started to grow in a rapid pace. Therefore, various electronic

applications and online networks also started rising.

E-commerce will bring change in the future as well and will continue to shift.

Year Event
1984 EDI was developed in late 90s to improve the limitation of EFT.It as
standardized through ASC X12. It will help the companies to make the easy
processing of the transaction.

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1992 Consumers were offered various retail products through computer servers that
helps them to do the transactions through their computers.
1994 Users were provided simple browser to surf the internet and a secure socket
layer technology to do a safe online transactions.
1995 Amazon.com and Ebay.com was developed which is known as the biggest
online sites in e-commerce.
1998 Digital subscriber line as developed that provides fast internet services. The
easy and fast access of internet saves time and money if the user.
1999 Organizations Started upgrading ecommerce sectors by spending in the
internet sectors over $20 billion.
2000 The government started extending the ecommerce filed and applications.

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3. Features of ecommerce
1) Ubiquity: The availability of internet access and web technology is found everywhere.
The internet services can be easily accessed at anywhere via mobile phone. Ecommerce is
ubiquitous that it can be everywhere. It is available 24*7.
2) Global Reach: Ecommerce can be conducted worldwide. It can be accessed globally. The
business transaction can be done across the country more conveniently and effectively
.The technology reaches across national boundaries.
3) Universal Standards: The technological standard for conducting ecommerce is universal
standards due to the world wide technical standard of internet. The universal standard
helps to reduce the cost, indirect costs by making easier business technology.
4) Richness: In ecommerce, it is possible to use audio, video, messages etc. Advertising and
Branding are very important part of ecommerce. It Is about as rich as television
technology.
5) Interactivity: Ecommerce are interactive in nature. They allow two way communications
between business and consumer.It allows the communication in a global scale.
6) Information Density: The improved technology brings positive growth in ecommerce. It
increases the quality and quantity of the product by reducing information costs. The
accuracy and timeliness of the information technology increases greatly. Information is
more useful than ever.
7) Personalization: Ecommerce allows for personalization and also permits customization. It
is customer oriented that is customers interests, needs etc. Merchant can change the
products or services based on users preferences and behaviour.

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 4. Modules of E-commerce used in Nepal
There are different modules of ecommerce used in Nepal. They are

1) B2B
2) B2C
3) C2C
4) B2G

1) B2B
B2B is the electronic Business transaction that is conducted between two business
organizations. Simply, it is the ecommerce transactions between the companies. It is the
process of buying and selling of goods and products between two different business
organizations through the use of electronic medium. It is the fastest ecommerce model than
others. In business to business ecommerce model, one organization sells its products to
another organization ad again the buyer organization sells the product to the final consumer.
In Nepal, B2B model is very popular because of low transaction cost, disintermediation, etc.
Wholesaler place an order from one website and sells that product to the final consumer. The
best example of B2B e-commerce is Amazon.com.

Consumer Seller Organization

Delivery

Purchase

Buyer Organization Ecommerce Site

order

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 In the above figure, the transaction between two different organizations is shown. In the
given figure, Buyer make an order from the seller organization through ecommerce site.
when the order is received by Seller organization then the product is delivered to the buyer
organization. When the buyer organizations receive the product, it is further sold to the final
consumer.

v. 2) B2C
The electronic transaction conducted between business organization and consumer is call
B2B e-commerce. It is the ecommerce between companies and consumer. It is the second
largest and he earliest form of ecommerce. The online retailing companies falls under this
model. In business to consumer e-commerce , companies sell their goods and products to the
consumer through online. Companies are directly connected to the consumer. There is no
middleman in the transaction conducted between them. It includes e-shop, e-malls providing
the various facilities like online stores, online services, auction stores etc.

Seller organization

Deliver

Customer
Order

Ecommerce site

In the above figure, Consumer direct place through ecommerce site. When the order is
received by seller organization then, it is delivered to the consumer.

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 3) C2C
It is a electronic transaction conducted between two consumers. The goods are bought and
sold only between the private individuals. One consumer fix the price of the products with its
description and another consumer buy the products by analysing its quality and price. There
is no middleman in between them. They have direct contact with each other for doing the
transaction of goods and money. There are also various C2C ecommerce sites in Nepal that
helps the consumer to sell and buy the product online. Hamrobazar.com is the best example
of C2C ecommerce.

E-commerce

Receive product
WantsReceive
to sell
Money
Wants to Buy

In The above figure, there are two consumers. One consumer who wants to sell the product
and the consumer who wants to buy the product. One consumer offers the goods to sell in the
ecommerce site where another consumer place an order for the goods. Then they buy and sell
the product, buyer organization receives the product and seller organization receives the
money.

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4) C2B
The electronic transaction that is conducted between the
consumer and the business organization is called
consumer to business ecommerce. It is the ecommerce
between the consumer and organization. In this model
consumer post their product online and the buyer bids for
the product. In this ecommerce sellers decide the price of
the product. Seller sell the product to organization with
the highest bidder ad can satisfy his expectation.
Priceline.com is the best example of consumer to business
ecommerce.

E-commerce .

Order Quote Price

Provide/get service or money

Organization
Provide/get service or money
Seller

In the above figure, seller sells the product to the business organization. Seller offers the
product with their own price and sells the product with highest bidder

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 5) Benefits of ecommerce
A. Benefits to Organization

i. International market place.

. Ecommerce helps to extend the business in the international market. The trend of
ecommerce helps the organization for the expansion of the national products in the
international markets. E-commerce helps to expand the marketplace to national and
international business markets

ii. Inventory management cost saving.

Another benefit of e commerce is inventory management and cost saving . e commerce site
helps an organization to reduce inventory. Inventory cost is reduced because there is no need
of presence of physical store in any particular location.

3) Reduce labour, advertising and telecommunication costs

Ecommerce helps to reduce labour, advertising and telecommunication costs. Since the
transactions are done online so Labour costs can be reduced. Advertising cost is cheaper
because it can be done by online websites. It lowers telecommunication costs by enabling
other communications such as emails.

4)Better customer service

Ecommerce provides better customer service facilities online. E-commerce is customer

oriented that it focuses on customer needs and satisfactions. Ecommerce provides consistency
and reliability to the consumer. A better customer services helps to improve the brand image
of an organization.

vi.

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 Benefits to consumer

1) Multiple choices
There are various types of goods and products in the ecommerce sites. Consumers are
provided various options and multiple choices to by the products. There are various sellers in
the ecommerce sites so that the consumer can buy the needed products from the lowest price.

2) Price comparison
There are various ecommerce sites in Nepal. Consumer has a benefit of comparing the prices
with various sites. The price of the product differs according to the online sites. So the
consumer can make the easy comparison of price and can make appropriate pricing decision.

3) Saves time
E-commerce application saves the time of the consumer. A consumer can buy the product by
home through online. A consumer can do the transaction without vising the physical stores
that helps to save the time of the consumer.

4) Improved delivery services

Ecommerce also provides the improved delivery services to the consumer. A consumer can
receive the products after their order at their own place. The products are delivered to the
consumer at any place at any time through various medium.

vii. Benefit to society

1) Enables more flexible working process
Ecommerce helps to do the online transaction in an easier and convenient way. It enables
more flexible working process. In ecommerce an individual can work so easily with the
access of internet which saves the time of the consumer as well. The products can also be
delivered to any location

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2) Facilitate delivery of public services
Ecommerce facilitates of delivery of public services health care, education, social services
etc. E-commerce helps the government to deliver the services to the public in an effective
way
.
3) Price comparison
Consumers can compare the price of various products and services with the help of
ecommerce sites and application. As e-commerce site provides variety of options
consumer can compare the best products as per their need and can select the best
alternatives among the available products.

4) saves time and money of consumers

e commerce helps to save the money and time of customers. As most of the e commerce
site provides home delivery services which helps to save the time of consumers .
ecommerce helps to save the money of customers as products are available in ecommerce
site are particularly cheaper than available in normal market .

5) facilitates delivery of public services.

Ecommerce facilitates delivery of public services such as healthcare, education, and
distribution of government social services at a reduced cost and or improved quality.

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6) Limitation of Ecommerce
1) Limitation to organization
1) Lack of security, Reliability, standards and communication protocols
The disadvantages of ecommerce to organization is lack of security, , standards and
communication protocols. Hacking is one of the major problem of ecommerce in an
organization. However, an organization always tries to give security, reliability and
standard to the consumer but also there may be various online hackers to destroy the
security.

2) Rapidly evolving and changing technology

The technology is changing day by day. The new technologies are developing every day
which is the major threats to the organization. Ecommerce application are evolving and
changing rapidly. The old technologies are replaced by the new technologies.

3) Pressure to innovate
Innovation is the major challenges to an organization. Innovation means to create new
ideas and knowledge. E-commerce creates pressure to innovate because sometimes it
becomes difficult to integrate ecommerce software or website with the existing
applications.

4) Facing increased competition

There are large number of ecommerce sites in Nepal. The larger online sites creates the
more competition. An organization is facing increased competition due to the new entrants
of online websites, different prices, web-based technologies etc.

2) Limitation to consumer
1) lack of security, trust and privacy of personal data.
There is lack of trust, security and privacy of persona data of a consumer due to the
increased number of competition. This type of issues appears to the consumer due to the
complete dependency on the internet technologies.

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 2) Fake websites

Anyone can set up an ecommerce sites. There may be fraud in various online website
which are unknown for the users. It is very difficult for the users to identify whether the
ecommerce are genuine or not. Fake websites creates fraudulent to the consumer which
may take the consumer to the negative aspects of online transactions.

3) Not everyone is connected to the internet

In the developing countries like Nepal, not all the people are connected to the internet. The
internet users are still very less in the country like Nepal. If People are not connected to
the internet then the target of ecommerce fails to reach the consumers. The internet users
are slowly increasing.

4) No personal examination of the product +

Ecommerce doesn’t allow the inspection of the products before buying. A consumer can
only see the products with its quality quantity brand but cannot touch and check it. There
is no personal examination and experience of the products to the consumers before
purchasing.

Limitation to society
1) Breakdown in human interaction
There lacks face to face interaction among the people in ecommerce transactions.
The people are more connected to the internet than each other . There is a breakdown in
human interaction among the people due to the excessive use of internet
.
2) Reliance on telecommunication, infrastructures, power and IT skills
All the people are busy using the online website, internet and web-site technologies. They
spend their entire time on using the internet. Ecommerce creates reliance on
telecommunication, infrastructures, power and IT skills

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7) Ecommerce sites in Nepal
1) Kaymu.com
2) Muncha.com
3) Hamroshopping.com
4) hamrobazar.com
5) Rojeko.com
6) Foodmandu.com
7) Bhatbhatenionline.com
8) Harilo.com
9) Merotarkari.com
10) Yeskantipur.com

C.Payment method while conducting ecommerce in

Nepal

E-Sewa Nepal
Esewa is developed by |F1 soft in Kathmandu and it is verified by verisigh authentication
service. It is the first online payment method of Nepal. It is used for making an online
payment, paying bills and receiving money. It is done over a secured channel. It is done
without exposing bank account or credit card number to the merchant where you pay your
bills. E-sewa is free for using the service. In some cases of delivering goods and services, it
may charge small amount. Esewa is used in various stores like yeti airlines, QFX cinema,

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Buddha air, bhatbhatenionline.com etc. Esewa is also liked up with various Nepalese banks
which helps the users to pay via banks as well.

Objectives of e-sewa
It is established with an aim to help and support e-coomerce business. E-sewa allows
payment and money transfer through internet and serves as an electronic alternative to the
traditional complicated paper method such as cheques and money orders.

eSewa - Type of Application

eSewa is available in two modules: B2B and B2C.

eSewa specializes in Secure Real-time transaction processing service and support. eSewa
online payment gateway performs payment authorization and authentication, and makes
settlement of funds between Banks, Merchant and User(Customer).
Currently, it provides the following online services:
1. Sending and Receiving Money
2. Payment of Utility Bills
3. Purchase of Air Tickets and Movie Tickets
4. Purchase of Recharge and Calling Cards
5. Payment of School and College Bills
6. Payment of Internet Service Bills
7. Subscription of Newspapers and Magazines
8. Payment of Credit Card Bills
9. Facility of all eSewa services through mobile phone

Advantages of eSewa
1. Full 24x7x365 convenience
2. Rapid and efficient transaction processing
3. Multiple payment options
4. Secure flow of transaction details among buyers, sellers and financial institutions
5. Flexible and powerful real time report generation

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 6. Facility for customer refund
7. Merchants can get rid of large databases, extensive processing and complex software
8. CA (Certifying Authority) authenticated secure servers
9. Ability to provide value added services to merchants, acquiring and issuing banks

viii. 8) Future of ecommerce in Nepal

Before years, there was only the practice of traditional ecommerce in Nepal. The buying,
selling and exchange of goods and services between two persons and organizations was
done without any electronic means. But the transaction method has completely changed.
There is the development of ecommerce which has made the people do online transaction
easily. Nepali ecommerce has a bright future ahead. Ecommerce should be adopted in all
the sectors and business operations as well. With the growing generation all the businesses
have to adapt and think about their online existence in future depending on the nature of
business. The five predictions of future of ecommerce in Nepal are:

1) Shift from traditional Retailing

2) Growth of mobile ecommerce
3) Better software Implementation
4) Utilization of near field communication
5) Increased customer care

As per the current scenario ecommerce transactions are increasing rapidly. People prefer to
shop online, order their food online and are used to various online facilities like paypal,
esewa, etc. So as per the current trends of ecommerce in Nepal we can say that people will be
more used to ecommerce in coming future than that of traditional commerce.
.

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9) M-Commerce

M-commerce means mobile commerce. In simple words, it is the next generation to e-

commerce. It is the electronic way of doing transaction through the wireless handheld
devices such as cellular telephone, mobile and personal digital assistants. The buying and
selling of goods and services of transferring the ownership of goods which is completed
by using mobile access to electronic network with the help of electronic devices is called
M-commerce. M-commerce helps the users to access the internet with no plug in. It can
also be defined as the implication of information and communication technology for the
purpose of doing electronic business. It is not just about the use of mobile, there are
various devices used in m-commerce. Some of them are:

1) Mobile telephone
2) Laptop
3) Earpiece
4) Personal digital assistance

Application of M-Commerce
1) Mobile Banking
M-Commerce is widely applicable in banking sectors and financial institutions. The
application of m-commerce in banking sectors helps the users to access information and to
make transactions as well. customers can performs the transaction like buying and selling
of the stocks, checking our account status, remitting money etc. through their mobile
phone .

2) Mobile ticketing
It is the digital way of booking the ticket via our mobile phone .The traditional way of
paper ticket has been replaced by mobile commerce. Now, the users can easily buy the
tickets through the mobile devices. Mobile ticketing helps to convert the paper ticket into
the digital for in the mobile phone. It has made the users very easily to book and cancel the
ticket by the simple application on our mobile phone. It is applicable especially in cinema
halls, airport etc.

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3) Mobile Marketing
It is the process of communicating to the users and providing services based on mobile
communication technologies. Mobile marketing is an Emerging concept. It is growing in a
rapid pace. Nowadays, mobile marketing has made very easy to access and explore the
information to the users by within our mobile phone. It is cheapest way of doing
marketing as well.

4) Mobile shopping
Mobile shopping means the electronic method of buying products online. It is also known
as online shopping. By using mobile phone, customer can purchase anything from the
multiple choices, via online using mobile. It is the cheapest method of doing online
transactions. The paper catalogue is being replaced by digital list of products in respective
sites. It helps the customer to buy simply from the mobile phone as well.

5) Location based services

M-Commerce is very popular to know the location of people, places, colleges, banks etc.
user can easily identify the current status of the location only through our mobile phone
sitting in the home. M-commerce helps to provide location based services such as local
maps, local weather, people’s location, trafficking etc.

Trend of m-commerce
The use of mobile commerce is being popular day by day. Because everyone is connected
to the phone and internet, the m-commerce now is widely used by all. M-commerce is the
future of ecommerce in Nepal. Smart phones have penetrated the market in Nepal. M-
commerce has given rise to changing market trends and customer expectations. The recent
trends of m-commerce in Nepal are:

1) Online retailing and customer behaviour

Online shopping has transformed the way of doing traditional transaction to online
shopping. People are very busy these days, so they find it more easy and convenient to
shop online rather than visiting physical stores due to their busy schedules. Kaymu.com is
the best example for M-Commerce, as it is providing the services of variety of products to

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 the customer with a mobile phone. Now the customer can choose the best product and
order online through various online sites.

2) Modes of payment
The technology is rapidly evolving and growing day by day. The mode of payment has
also changed due to the rapidly growing mobile applications. Nowadays, financial
transactions can be made easily via mobile phones. Customers can easily buy the needed
products and make secure transaction via mobile phones. People use the smartphones that
adopt digital wallets through which the payment can be made via phones.

3) Multiple choices
In an online retailing, the preference is given to customer, their needs and satisfaction.
There are multiple of choices available for customer in online sites that helps the customer
to buy the product through online. Customers can pay through debit card, credit card and
the goods can be delivered at their doorstep. Nepbay is the best example in Nepal that
allows the customer to pay for their ordered items.

4) Mobile location and Usage

It is very easy to do online shopping through mobile network. We can do online shopping
sitting at anywhere at any place. Mobile commerce has played a vital role for both
consumer and supplier. It is the easiest and simplest way of doing business transactions.

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10) Recommendation
We must create history not become a history. We are always active on the development,
process and the business policy and strategy on eCommerce. business for our offshore clients.
We offer different online payment system verification. Nepsol will guide you with the start-
to-end process for making your business online. We say, it’s time to go online, sell online,
Payments should be easy. Every individual’s trust must be built by business owners. Time
has come to take your business online, start your online shop today!!! We will be happy to
get comments , reviews and feedback additional data and reports will be a advantage factor to
complete our hunt and the development on eCommerce in Nepal . Thank you for your
support

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11) Bibliography

1. http://www.nepsolweb.com/ecommerce-in-nepal-1/

2. https://ecommerze.wordpress.com/2008/06/12/the-history-and-evoltion-of-e-commerce/

3. https://www.ukessays.com/essays/information-technology/the-seven-unique-features-of-e-
commerce-essay.php

4. http://ecommercenepal-bpinl.blogspot.com/2011/03/major-different-types-of-e-commerce-
are.html

5.Limitationtoconsumer(http://ecommerce.about.com/od/eCommerce-
Basics/a/Disadvantages-Of-Ecommerce.htm)

6. Ecommerce in Nepal(http://www.nepsolweb.com/ecommerce-in-nepal-1/ )

7. M-Commerce(http://www.articlesbase.com/computers-articles/m-commerce-and-its-
applications-1011452.html )

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