The high cost of data bundles in Kenya, which is higher than in any other East African country, is affecting the growth of e-commerce, a new report says.
The report by popular online shopping site Jumia titled “The White Paper: Trends From the Kenyan Smartphone and E-Commerce Industry”, shows mobile service subscribers are overcharged on their mobile date subscriptions. “The cost of Internet bundles in Uganda is 50 per cent lower than in Kenya while in Tanzania, it is 30 per cent lower. This does not augur well with the majority of people we are trying to lure into online shopping,” says the report.
Jumia Country Manager for Kenya Sam Chapettee said during the report’s launch in Nairobi yesterday the situation has not been helped by a rise in smartphone penetration in the country.
“Smartphone penetration has grown to over 60 per cent of the population thanks to the influx of affordable phones. This ‘democratisation’ of the smartphone device has been driven by the entry of low-cost Chinese brands, with Infinix and Tecno being the top selling brands on Jumia,” said Chapette.
The report notes that the price of smartphones has been decreasing over the years from about Sh23,000 in 2013 to about Sh10,000 in 2016, although it is not expected to decrease further over the next two years.
“The price is not expected to decrease because brands will be looking to develop their market share by investing more in new technology and sophisticated features,” says the report.
It also predicts that smartphone penetration could rise further, with the burgeoning middle-class acquiring more purchasing power.
In 2016 alone, 200,000 smart phones were sold on Jumia